A new report from the U.S. Census Bureau showed that privately-owned housing starts in June grew at a seasonally adjusted annual rate (SAAR) of 1.215 million units. That was an 8.3 percent increase from May’s upward-revised print, the first monthly gain since February, and better than economists had expected. Single-family housing starts rose by a healthy 6.3 percent in June, and multi-family units (rentals) jumped by 15.4 percent.
Regionally, housing starts last month fell in the South (-3.8 percent) but increased in the Northeast (+83.7 percent), the Midwest (+22.0 percent), and the West (+1.6 percent). As for total building permits, this popular gauge of future construction activity lifted by 7.4 percent in June, the largest gain since 2015 and better than anticipated. Despite the uptick in construction activity last month, overall homebuilder sentiment has weakened recently, according to new data from the National Association of Home Builders (NAHB). Higher costs for lumber and other construction materials are partially to blame, and NAHB chairman Granger MacDonald added that the sudden inflation is “hurting housing affordability even as consumer interest in the new-home market remains strong.”
Sources: Econoday, NAHB, U.S. Census Bureau, FRBSLPost author: Charles Couch