May Housing Starts Fell Short Of Forecasts

Posted by Patrick Barnard on June 17, 2014 No Comments
Categories : Required Reading

15579_new_construction May Housing Starts Fell Short Of Forecasts 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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