US single-family housing starts, permits fall in April
Data for March was revised higher to show single-family starts falling to a rate of 1.035 million units instead of the previously reported 1.022 million units
US SINGLE-FAMILY homebuilding and permits fell in April amid a resurgence in mortgage rates, but new construction remains supported by an acute shortage of houses for sale.
Single-family housing starts, which account for the bulk of homebuilding, slipped 0.4 per cent to a seasonally adjusted annual rate of 1.031 million units last month, the Commerce Department’s Census Bureau said on Thursday (May 16).
Data for March was revised higher to show single-family starts falling to a rate of 1.035 million units instead of the previously reported 1.022 million units. Housing starts increased 17.7 per cent year-on-year in April.
The average rate on the popular 30-year fixed mortgage pulled back from a five-month high of 7.22 per cent to 7.09 per cent last week, data from mortgage finance agency Freddie Mac showed, as easing labour market conditions put two rate cuts from the Federal Reserve this year back on the table.
The rise in mortgage rates over the course of April and the first week of May caused confidence among homebuilders to slump this month. The National Association of Home Builders also expressed concerns on Wednesday about recent regulations requiring the Department of Housing and Urban Development and the Department of Agriculture to insure mortgages for new single-family homes only if they are built to the 2021 International Energy Conservation Code. It said the regulations would increase the cost of construction.
The nation is facing a severe housing shortage, which should keep new construction supported. Government data showed there were 728,000 housing units on the market in the first quarter, well below the 1.145 million units before the Covid-19 pandemic.
Starts for housing projects with five units or more soared 31.4 per cent to a rate of 322,000 units in April. Overall housing starts increased 5.7 per cent to a rate of 1.360 million units.
Economists polled by Reuters had forecast starts rebounding to a rate of 1.420 million units.
Permits for future construction of single-family homes dropped 0.8 per cent to a rate of 976,000 units in April. Multi-family building permits tumbled 9.1 per cent to a rate of 408,000 units.
Building permits as a whole fell 3.0 per cent to a rate of 1.440 million units. REUTERS
Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox. Free.
Share with us your feedback on BT's products and services
