The U.S. Census Bureau and the Department of Housing and Urban Development reported Tuesday morning that new housing starts in April fell to a seasonally adjusted annual rate of 1.172 million, a decrease of 2.6% from the upwardly revised March rate of 1.203 million, and an increase of 0.7% compared with the April 2016 rate of 1.164 million. The consensus estimate from a survey of economists expected a rate of around 1.256 million.
The revision to the March rate added 57,000 new housing starts to the previously reported total.
The seasonally adjusted rate of new building permits also declined in April to 1.229 million, down 2.5% from the upwardly revised March rate of 1.260 million and up 5.7% from the April 2016 rate of 1.077 million. The consensus estimate called for 1.271 million new building permits.
Single-family housing starts rose in April to an annualized rate of 835,000, up 0.4% from the revised March rate of 832,000. Single-family starts rose by 8.9% year over year in April.
While year-over-year totals are encouraging, the month-over-month numbers may be a cause for concern for first-time buyers who already face tight inventories and higher prices.
Permits for new single-family homes fell 4.5% month over month in April, to an adjusted annual rate of 789,000, from a revised total of 826,000 in March. The rate rose 6.2% year over year.
Multifamily starts for buildings with five or more units decreased by 14.6% year over year in April and fell by 9.6% compared with March.