Share this on FacebookJune 18th, 2020 | by NEWCA
After steep declines caused by the COVID-19 shutdowns, US home construction saw a strong rebound in May with a 4.3 percent increase.
The US Commerce Department reported Wednesday that new home starts were at a seasonally adjusted rate of 974,000 last month.
According the Associated Press (AP), “building permits, a good indication of future activity, rose a sizable 14.4% in May to an annual rate of 1.22 million units.”
Some other key figures reported:
• New single-family home construction was by 5.4%
• Apartment of five units or more increased by 16.9%
By region, overall new residential construction was up by an amazing 69.8 percent in the West and 12.8 percent in the Northeast. Housing starts were actually down by 1.5 percent in the Midwest.
A survey by the National Association of Home Builders and Wells Fargo of builder confidence released this week “showed a record jump of 21 points in June to a reading of 58. Any reading above 50 indicates a positive market.”
Nancy Vanden Houten, lead U.S. financial economist at Oxford Economics, told the AP: “We look for strong demand, improving homebuilder confidence and an ongoing shortage of supply to support growth in housing starts over the rest of the year, but we still expect starts to be down on average across 2020 overall.”
But still other economists see these indicators of a positive change. “Housing construction has turned the corner,” declared Doug Duncan, chief economist at Fannie Mae, told Forbes.com. “we believe it suggests that the bottom in home construction has passed.”