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Housing Starts: Smaller Rebound Than Expected

June 16, 2021
Bottom Line:  Housing starts rose modestly, less than expected, in May as the trend continues to move higher, albeit with a bit less momentum. In the three months ended in May, sales averaged just over 1.6 million annualized units, modestly above the six- and 12-month averages of 1.59 and 1.52 million units.  Homebuilders' outlooks have been uncertain volatile input prices and increased mortgage rates since late last year.  That said, despite these potential headwinds, the overall level of housing activity remains historically strong. Housing should continue to add positively to US GDP in the 2nd Quarter.
Housing Starts ROSE by 3.6% in May to 1572k, compared with market expectations for an increase to 1630k.  Meanwhile, the prior month was revised moderately lower from 1,569k to 1,517k.  Housing starts are now 50.3% ABOVE their year-ago level.  However, they are still a sharp 30.8% BELOW their January 2006 peak.
Single-Family Housing Starts
ROSE by 4.2% to 1098k. Single-family housing starts are 49.8% ABOVE their year-ago level but still 39.8% BELOW their January 2006 peak.
Multifamily Housing Starts ROSE by 2.4% to 474k. Multifamily starts are now 51.4% ABOVE their year-ago level.