U.S. Housing Starts Edge Down By 0.3% In May

(RTTNews) - New residential construction in the U.S. saw a modest decrease in the month of May, according to a report released by the Commerce Department on Friday.

The report said housing starts edged down by 0.3 percent to an annual rate of 1.164 million in May from the revised April estimate of 1.167 million.

Economists had expected housing starts to dip to a rate of 1.150 million from the 1.172 million originally reported for the previous month.

The slight drop reflected a decrease in multi-family starts, which fell by 1.2 percent to annual rate of 400,000 in May.

On the other hand, the Commerce Department said single-family starts inched up by 0.3 percent to a rate of 764,000.

The report also said building permits, an indicator of future housing demand, rose by 0.7 percent to an annual rate of 1.138 million in May from the revised April rate of 1.130 million.

Multi-family permits surged up by 5.9 percent to a rate of 412,000, while single-family authorizations slumped by 2.0 percent to a rate of 726,000.

Compared to the same month a year ago, housing starts were up by 9.5 percent but building permits were down by 10.1 percent.

The National Association of Home Builders released a separate report on Thursday showing a bigger than expected improvement in homebuilder confidence in the month of June.

The report said the NAHB/Wells Fargo Housing Market Index climbed to 60 in June after holding steady at 58 for four consecutive months. Economists had expected the index to inch up to 59.

The bigger than expected increase lifted the housing market index to its highest level since reaching 61 in January.