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US housing construction rose more than expected in April, and the previous month's activity was stronger than expected, suggesting that lower mortgage rates were beginning to provide market support. of housing in difficulty.
Housing starts rose 5.7% to 1.235 million units year-on-year seasonally adjusted, thanks to the construction of single-family and multi-family housing units, the Commerce Department announced Thursday. . Work was also boosted by the drier weather in the Midwest.
March data were revised upwards to indicate that home construction would reach 1.168 million units, instead of falling to 1.139 million units, as previously reported.
The government revised seasonally adjusted data until January 2014. The unadjusted series will be revised in July.
Building permits rose 0.6% to reach a rate of 1.296 million units in April. Building permits decreased for three consecutive months. Single-family housing permits, however, declined for a fifth consecutive month, suggesting a moderation in housing construction in the coming months.
Economists polled by Reuters had forecast that housing starts would reach 1.205 million units in April.
The 30-year fixed mortgage rate fell to 4.10% after a peak of about 4.94% in November, according to data from the mortgage finance agency Freddie Mac. The decline in mortgage rates reflects the recent decision of the Federal Reserve to suspend its three-year monetary policy tightening campaign.
A study conducted Wednesday showed that homebuilders' confidence reached its highest level in seven months in May. While declining borrowing costs are driving demand, builders said "continue to address labor and batch shortages and rising material costs that are holding back supply and hurting the economy. affordability.
The housing market has been mired for a year. Investment in housing construction contracted at an annualized rate of 2.8% in the first quarter, the fifth consecutive quarterly decline.
Single-family home construction, which accounts for the largest share of the housing market, rose 6.2% to 854,000 units in April. Single-family home construction increased in the Midwest, which had been flooded in previous months. Single-family home starts have also increased in the Northeast and in the West, but have dropped in the South, where the bulk of homebuilding is concentrated.
Single-family building permits fell 4.2% to 782,000 units in April.
Starts in the volatile multi-family housing segment rose 4.7% to 381,000 units last month. Building permits for multi-family dwellings rebounded 8.9% at a rate of 514,000 units last month.
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