Housing starts surge in the Northeast

The latest residential construction report shows a 3.0 percent gain in total housing starts for the month of June compared to May

The U.S. Census Bureau reported Wednesday morning that the seasonally adjusted annual rate for total starts for June was 1,353,000, compared to an upwardly revised 1,314,000 for the month of May.

The Northeast fared well, with double-digit percent gains in total starts on both monthly and annual basis, and a double-digit gain for 1-fam starts compared to a year ago.

Single family starts were up for the year, but down for the month—the mirror image of building permits, which were up for the month but down compared to the same month last year.

On an unadjusted basis, the bureau counted 126,100 total starts for the month. Of those, 92,300 were single family.

The National Association of Home Builders posited that elevated interest rates for home mortgages and construction and development loans kept single-family production and demand in check during June. Still, year-to-date, single-family starts are up 16.1 percent.

“With better inflation data, the Federal Reserve is expected to begin rate reductions later this year, and an improving interest rate environment will help buyers as well as builders and developers who are contending with tight lending conditions and high interest rates,” said NAHB Chief Economist Robert Dietz. “And with home inventory at a relatively low 4.4 months’ supply, builders are prepared to increase production in the months ahead. NAHB survey data of forward-looking builder sales expectations saw a gain in July.”