Housing starts fell short of forecasts in May, as home builders remained cautious due to lackluster home sales so far this year. What's more, builders have been having a hard time finding suitable lots for sale and have been facing a shortage of skilled labor.
According to figures released by the U.S. Census Bureau and U.S. Department of Housing and Urban Development (HUD), housing starts were at a seasonally adjusted annual rate of 1.001 million in May – about 6.5% below the April revised estimate of 1.071 million.
Still, this is 9.4% above the May 2013 rate of 915,000 units.
Single-family housing starts were at a rate of 625,000 – about 5.9% below the revised April figure of 664,000. The May rate for units in buildings with five units or more was 366,000.
It doesn't appear that there will be a meaningful pickup in new home construction anytime soon: According to the report, privately owned housing units authorized by building permits in May were at a seasonally adjusted annual rate of 991,000 – about 6.4% below the revised April rate of 1.059 million and about 1.9% below the May 2013 estimate of 1.010 million.
In what might be considered a bright spot, authorizations for single-family homes were at a rate of 619,000 – about 3.7% above the revised April figure of 597,000. This is significant because construction of multifamily housing has generally been outpacing construction of single-family homes. Authorizations of units in buildings with five units or more were at a rate of 347,000, according to the Census Bureau/HUD.
Despite the weak numbers, home builders did increase output in May, compared to April: According to the report, privately-owned housing completions were at a seasonally adjusted annual rate of 897,000 – about 6.8% above the revised April estimate of 840,000 and about 24.8% above the May 2013 rate of 719,000.
Single-family housing completions were at a rate of 618,000 – about 2.1% above the revised April rate of 605,000 – while the rate for units in buildings with five units or more was 269,000.
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