May was another sterling month for new construction, with housing starts rising by nearly 30 percent from the year before.
The U.S.’ new construction marketplace continued to recover in May, with housing starts rising 28.6 percent year-over-year to a seasonally adjusted annual rate of 914,000, according to the latest numbers from the Census Bureau.
Though housing starts in May were below projections of a 950,000 annual rate, they were still 6.8 percent above April’s numbers, and year-to-date numbers for starts are nothing but positive.
Housing Starts and New Construction Show Promise
Though single-family housing starts were up just 0.3 percent from April to May, they did rise 16.3 percent year-over-year. Other important information on the housing-start front included:
- For the first five months of 2013, single-family housing starts are up 24 percent from the same period in 2012.
- As has been the case in the past, though, multifamily construction is ultimately leading the way, soaring 40 percent year-to-date over 2012’s numbers.
- According to analysis by Bill McBride on Calculated Risk, though, that situation could soon change. Not only has multifamily construction likely peaked, but with homebuilder confidence on a tear, there’s a very good chance that single-family starts will pick up additional steam in June.
- Eve Bremen, the managing broker for Coldwell Banker in Winnetka, said she’s definitely seeing a similar demand for new construction properties in Chicago’s North Shore. “There is tremendous demand,” she said.
Building Permits and Housing Completions
Of course, there was more to the Census Bureau’s numbers than housing starts, and the government agency also reported promising findings on building permits and housing completions.
Building permits, which anticipate new construction projects, declined 3.1 percent from April to May to a seasonal rate of 974,000, though that number is a hefty 20.8 percent above May 2012. Also, single-family building permits were up 1.3 percent from April to May, though the volatile multifamily sector saw permits decline 13 percent.
Similarly, housing completions in May were down 0.9 percent on a monthly basis but up 12.6 percent from last year, while single-family housing completions rose 4.2 percent; that latter stat is particularly promising, given that housing inventory remains historically low.