US. Residential construction grew more-than-expected in April and month-on-month activity was stronger than initially anticipated, suggesting that declining mortgage rates are supporting the weak housing market somewhat. Housing starts jumped 5.7% to a seasonally adjusted annual rate of 5.7% According to the Commerce Department, 1.235 million housing units were sold last month, reflecting profits from the construction of single and multi-family homes. The groundbreaking was probably triggered by the drier weather in the Midwest.
March data has been revised to increase to 1.168 million units, instead of 1
The government revised seasonally adjusted data to January 2014. The unadjusted series will be revised in July.
Building permits rose by 0.6% to 1.296 million units in April. The building permits had been rejected for three months. Single-family home permits, however, fell for a fifth month in a row, suggesting that residential construction activity will slow in the coming months.
According to Reuters surveys, housing starts would rise to 1.205 million units in April.
The 30-year fixed mortgage rate has dropped from a high of 4.94% in November to 4.10%, according to mortgage lender Freddie Mac. Falling mortgage rates reflect the Federal Reserve's recent decision to suspend its three-year monetary tightening campaign.
A survey on Wednesday revealed that home builders' confidence rose to a seven-month high in May. While lower borrowing costs are driving demand, builders said they "continue to struggle with the ongoing labor shortage and lack of land and rising material costs, which slow down supply and affect affordability." Year. Housing investment declined 2.8% on an annualized basis in the first quarter, the fifth consecutive quarterly decline.
Housing for single-family homes, which accounts for the largest share of the housing market, rose 6.2% to 854,000 units in April. The housing construction of single-family homes in the Midwest, which had been hit by floods in recent months, increased. The number of single-family homes also increased in the northeast and west, but declined in the south, where most of the housing construction takes place.
Single-family home permits declined by 4.2% in April to 782,000 units.
The launches for the volatile segment of multi-family homes rose 4.7% to 381,000 units last month. Permits to build multi-family homes rebounded by 8.9% last month to 514,000 units.