Housing starts nationwide were more or less flat in the last month, at a seasonally adjusted rate of 1.16 million for the month. The amount of new building permits issued – a gauge of future construction – was also more or less flat at an annual rate of 1.14 million permits.
That’s not great news for anyone concerned about the shortage of inventory, but despite that there may be some relief on the way, for some markets anyhow. That’s because single-family home starts jumped by 10 percent from one year ago, according to the U.S. Department of Housing and Urban Development and the Commerce Development’s latest data.
“Despite May’s relatively flat report, our builders are telling us that the market is improving and consumers are more ready and willing to make a home purchase,” said Ed Brady, chairman of the National Association of Home Builders.
Some regions did see noticeable upticks. For example, in the West, both single-family and multifamily home starts rose, by almost 14.4 percent compared to one month before. In the South there was a 1.5 percent increase in new home starts. However, other regions saw declines – for example in the Northeast new home starts plunged by 33.3 percent compared to the month before. The Midwest also saw a 2.5 percent decrease. However, if multifamily starts are excluded, we can see that single-family home starts grew month-over-month in three regions – the Northeast, the South and the West.
“Builder confidence rose this month and single-family housing starts are up roughly 10 percent from a year ago — two indicators that we can expect further growth in housing production this year,” NAHB Chief Economist Robert Dietz said. “However, builders continue to face supply-side constraints, such as shortages of buildable lots and labor.”