New home completions rise 5.6 percent in May
But permits and starts lag behind April's rate.
U.S. homebuilders had their hands full completing new homes in May, but ongoing lot and labor shortages continue to put a lid on permits and starts. The U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly announced the following new residential construction statistics for May 2017:
Building Permits
Privately-owned housing units authorized by building permits in May were at a seasonally adjusted annual rate of 1,168,000. This is 4.9 percent (±0.9 percent) below the revised April rate of 1,228,000 and is 0.8 percent (±1.1 percent)* below the May 2016 rate of 1,178,000.
Single-family authorizations in May were at a rate of 779,000; this is 1.9 percent (±1.0 percent) below the revised April figure of 794,000. Authorizations of units in buildings with five units or more were at a rate of 358,000 in May.
Housing Starts
Privately-owned housing starts in May were at a seasonally adjusted annual rate of 1,092,000. This is 5.5 percent (±11.9 percent)* below the revised April estimate of 1,156,000 and is 2.4 percent (±11.4 percent)* below the May 2016 rate of 1,119,000.
Single-family housing starts in May were at a rate of 794,000; this is 3.9 percent (±10.4 percent)* below the revised April figure of 826,000. The May rate for units in buildings with five units or more was 284,000.
Housing Completions
Privately-owned housing completions in May were at a seasonally adjusted annual rate of 1,164,000. This is 5.6 percent (±9.2 percent)* above the revised April estimate of 1,102,000 and is 14.6 percent (±10.9 percent) above the May 2016 rate of 1,016,000.
Single-family housing completions in May were at a rate of 817,000; this is 4.9 percent (±11.6 percent)* above the revised April rate of 779,000. The May rate for units in buildings with five units or more was 335,000.
NAHB interprets the report
“Today’s report is consistent with builder sentiment in the housing market, indicating some weakness after a strong start to the year,” said NAHB Chairman Granger MacDonald. “Ongoing job growth, rising demand and low mortgage rates should keep the single-family sector moving forward this year, even as builders deal with ongoing shortages of lots and labor.”
“After a strong start for single-family building this year, recent months have recorded softer readings,” said NAHB Chief Economist Robert Dietz. “However, on a year-to-date basis, single-family starts are up 7.2% as builders add inventory to the market.”
Regionally in May, combined single- and multifamily housing production rose 1.3% in the West and remained unchanged in the Northeast. Starts fell by 9.2% in the Midwest and 8.8% in the South.
Overall permit issuance in May was down 4.9% to a seasonally adjusted annual rate of 1.17 million units. Single-family permits inched down 1.9% to 779,000 units while multifamily permits fell 10.4% to 389,000.
Regionally, overall permits rose 3.3% in the Northeast. Permits fell 9.4% in the Midwest, 0.3% in the South and 13.1% in the West.
Sources: U.S. DOC and NAHB
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