Housing Starts in U.S. Down 5.5 Percent in May
Multifamily Decline Brings Overall Housing Starts Down
According to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department, led by a decline in multifamily production, nationwide housing starts fell 5.5 percent in May to a seasonally adjusted annual rate of 1.09 million units.
Multifamily starts fell 9.7 percent to a seasonally adjusted annual rate of 289,000 units while single-family production edged down 3.9 percent to 794,000.
"Today's report is consistent with builder sentiment in the housing market, indicating some weakness after a strong start to the year," said Granger MacDonald, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Kerrville, Texas. "Ongoing job growth, rising demand and low mortgage rates should keep the single-family sector moving forward this year, even as builders deal with ongoing shortages of lots and labor."
"After a strong start for single-family building this year, recent months have recorded softer readings," said NAHB Chief Economist Robert Dietz. "However, on a year-to-date basis, single-family starts are up 7.2 percent as builders add inventory to the market."
Regionally in May, combined single- and multifamily housing production rose 1.3 percent in the West and remained unchanged in the Northeast. Starts fell by 9.2 percent in the Midwest and 8.8 percent in the South.
"Overall permit issuance in May was down 4.9 percent to a seasonally adjusted annual rate of 1.17 million units. Single-family permits inched down 1.9 percent to 779,000 units while multifamily permits fell 10.4 percent to 389,000.
Regionally, overall permits rose 3.3 percent in the Northeast. Permits fell 9.4 percent in the Midwest, 0.3 percent in the South and 13.1 percent in the West.