Housing starts see increase in June

Housing starts in June improved 4.8 percent to an annual rate of 1.19 million units, according to a recent release from the National Association of Homebuilders.

This was an increase from May’s report of 1.14 million units. However, compared to June 2015, June 2016 is down 2 percent. However, overall permit issuance increased 1.5 percent to an annual rate of 1.15 million, according to NAHB.

“This month’s uptick in production is an indicator that the housing market continues to move forward,” said NAHB Chairman Ed Brady. “At the same time, builders are adding inventory at a cautious pace as they face lot shortages and regulatory hurdles.”

New applications for building permits saw an increase of 1.5 percent in June, up to 1.15 million. However, that is a 13.6 percent decrease from June 2015.  When splitting those applications between single-family and multifamily, single-family permit requests saw an increase of 1 percent to 738,000, while multifamily permit requests saw an increase of 2.5 percent to 415,000.

“The June report is consistent with our forecast for a gradual but consistent recovery of the housing market,” said NAHB Chief Economist Robert Dietz. “Single-family production should continue to strengthen throughout the year, buoyed by job growth, new household formations and low mortgage interest rates.”

According to the NAHB report, regionally, the Northeast saw an increase of 45.3 percent, while the West saw an increase of 17.4 percent. The South saw a decrease of 3.4 percent, and the Midwest saw a 5.2 percent decrease. As expected, the number of permits issued increase in the Northeast by 9.4 percent and the West by 8.3 percent, while decreasing 10.1 percent in the West and 2.8 percent in the Midwest.