Nationwide housing starts were virtually unchanged in May, inching down 0.3 percent to a seasonally adjusted annual rate of 1.16 million, according to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department. Overall permit issuance edged up 0.7 percent to a seasonally adjusted annual rate of 1.14 million.
“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 NAHB Chairman Ed Brady, a home builder and developer from Bloomington, Ill.
“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,” said NAHB Chief Economist Robert Dietz. “However, builders continue to face supply-side constraints, such as shortages of buildable lots and labor.”
Single-family housing starts inched up 0.3 percent to a seasonally adjusted annual rate of 764,000 units in May while multifamily production edged down 1.2 percent to 400,000 units.
Combined single- and multifamily starts were mixed in May, rising 14.4 percent in the West and 1.5 percent in the South. The Midwest posted a 2.5 percent loss and the Northeast registered a 33.3 percent loss. However, single-family production rose in three out of the four regions — the Northeast, South and West.
Single-family permits fell 2 percent to a rate of 726,000 while multifamily permits rose 5.9 percent to 412,000.
Permit issuance increased 15.3 percent in the West. Meanwhile, the South, Northeast and Midwest posted respective losses of 1.4 percent, 7.8 percent and 9.2 percent.
Sales of newly built, single-family homes dropped 6 percent in May from a downwardly revised April reading to a seasonally adjusted annual rate of 551,000 units, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.
“Although new home sales are down from a robust reading in April, they remain solid and builder confidence in the market is growing — two indicators that the housing sector should strengthen throughout the year,” said Brady.
“At an annual pace of 551,000 units, new home sales are up relative to the first few months of 2016 as well as last year,” said Dietz. “The sales market continues to make overall gains despite month-to-month volatility.”
The inventory of new homes for sale was 244,000 in May, which is a 5.3-month supply at the current sales pace. The median sales price of new houses sold was $290,400.
Regionally, new home sales rose by 12.9 percent in the Midwest. Sales fell by 0.9 percent in the South, 15.6 percent in the West and 33.3 percent in the Northeast.