Privately-owned housing units authorized by building permits in May were at a seasonally adjusted annual rate of 1,138,000. This is 0.7 percent (±1.3%)* above the revised April rate of 1,130,000, but is 10.1 percent (±1.8%) below the May 2015 estimate of 1,266,000. This, according to a joint announcement Friday on new residential construction statistics for May 2016, from the U.S. Census Bureau and the Department of Housing and Urban Development.
Single-family authorizations in May were at a rate of 726,000; this is 2.0 percent (±0.9%) below the revised April figure of 741,000. Authorizations of units in buildings with five units or more were at a rate of 381,000 in May.
According to realtor.com® Chief Economist, Jonathan Smoke, “Collectively, recent readings on new construction show little change from what we have already been observing this spring: Total permits are down on a year-over-year basis because of a substantial decline in multi-family construction, and single-family construction is continuing to show gains but the monthly pattern is erratic.”
According to the release, privately-owned housing starts in May were at a seasonally adjusted annual rate of 1,164,000. This is 0.3 percent (±14.0%)* below the revised April estimate of 1,167,000, but is 9.5 percent (±16.0%)* above the May 2015 rate of 1,063,000.
Single-family housing starts in May were at a rate of 764,000; this is 0.3 percent (±13.8%)* above the revised April figure of 762,000. The May rate for units in buildings with five units or more was 396,000.
“Starts, on the other hand,” Smoke continued, “are still showing year-over-year gains in total, for both single-family and multi-family. However, the most troubling sign in this year’s new construction data is the continued trend of four straight months of starts exceeding permits. This is an important signal that builders are slowing expansion. With starts exceeding permits, and permits on decline on a year-over-year basis, it appears that we will have even fewer starts and completions six months down the road.”
Privately-owned housing completions in May were at a seasonally adjusted annual rate of 988,000. This is 5.1 percent (±15.5%)* above the revised April estimate of 940,000, but is 3.5 percent (±13.1%)* below the May 2015 rate of 1,024,000.
Single-family housing completions in May were at a rate of 717,000; this is 2.3 percent (±14.8%)* above the revised April rate of 701,000. The May rate for units in buildings with five units or more was 263,000.
Quicken Loans Vice President Bill Banfield offers the following comments on the report:
“The dip in housing starts in May was primarily driven by regional drops in the Northeast and Midwest, yet year-over-year growth remains high. Another month of gains in building permits coupled with near record low rates provide opportunity for a bounce back in new home sales.”
For more information, visit www.census.gov.