A result of the repressed number of existing homes available for sale, new construction is booming. Housing Starts have risen 22% from last month to an annual rate of 1.631 million units. That’s the highest reading in over a year and well above the expected 1.4 million. Despite the huge increase today, Housing Starts are only up 5.7% from May 2022, which frankly is a more sustainable and economically viable figure. The number of new Building Permits, the step prior to Starts, has increased by roughly the same amount at 5.2% from this time last year.
The National Association of Home Builders rose for the sixth consecutive month to a reading of 55, and it’s the first time the Index has crossed 50 and into positive territory since last July. With a strong labor market, stable interest rates, and a scant number of existing homes listed for sale, expect Builder Confidence to continue to rise along with the number of projects getting started.