The U.S. Census Bureau and the Department of Housing and Urban Development reported Tuesday morning that new housing starts in May rose to a seasonally adjusted annual rate of 1.35 million, an increase of 5% from the downwardly revised March rate of 1.286 million and an increase of 20.3% compared with the May 2017 rate of 1.122 million. The May start-rate was the highest since 2007.
The revision to the April rate dropped 50,000 new housing starts from the previously reported total. The consensus estimate from a survey of economists expected a May rate of around 1.323 million.
Single-family housing starts rose month over month by 35,000 in May to 936,000. The increase reflects a month-over-month increase of 48,000 in the Midwest and a rise of 6,000 in the Northeast, along with declines of 18,000 in the South and 1,000 in the West.
The seasonally adjusted rate of new building permits slipped to 1.301 million, down 4.6% from the upwardly revised April rate of 1.364 million and 8% higher than the May 2017 rate.
Permits for new single-family homes fell in May from a revised annual rate of 863,000 in April to a seasonally adjusted annual rate of 844,000. The rate dipped 2.2% year over year.
Multifamily starts for buildings with five or more units increased by 0.2% year over year in May and fell by 1% compared with April. This number is more volatile than the single-family number and has moved mostly sideways since 2013.
In 2017, 1.202 million housing units were started, up 2.4% compared with 2016 and a 10-year high. An estimated 1.263 million permits were issued in 2017, up 4.7% year over year.