Housing starts rebound in June

Housing starts increased 4.8% in June, up from a downwardly revised May figure.

The increase rose more than most analysts expected, as building permits also increased slightly for the month.

Housing starts and building permits both declined compared to year-ago estimates.

According to stats released Tuesday by the U.S. Census Bureau and the Department of Housing and Urban Development, privately owned housing starts in June rose to a seasonally adjusted annual rate of 1,189,000, up 4.8% from the prior month. Compared to a year ago, however, starts declined 2.0% from the June 2015 pace of 1,213,000.

Single-family housing starts in June increased 4.4% to a rate of 778,000.

On a regional basis, residential construction showed a huge year-over-year gain in single-family starts in the Northeast — up 74.4%. Other big gains were scored in the Midwest, were total starts increased 26.0% compared to a year ago. And in the West, total starts increased 17.4% compared to the previous month.

"The June report is consistent with our forecast for a gradual but consistent recovery of the housing market," said Robert Dietz, the National Association of Home Builders's chief economist. "Single-family production should continue to strengthen throughout the year, buoyed by job growth, new household formations and low mortgage interest rates.”

 

Building permits in June were at a seasonally adjusted annual rate of 1,153,000. This is 1.5% above the revised May rate of 1,136,000, but is 13.6% below the June 2015 estimate of 1,334,000.