New Housing Starts Increase in June to Near 8-Year High

(ShareCast News) – Housing starts in the USA jumped in June, alongside a strong gain in permits.

Groundbreaking rose by 9.8% to an annual start of 1.17 million units adjusted seasonally as per the Commerce Department announcement this Friday.

Permitting for June reached a (seasonally adjusted, annual) rate of 1.343 million, the highest level for the nation since July 2007, when the (seasonally adjusted, annual) pace stood at 1.361 million. This represents an increase of 7.4% from the May 2015 annualized rate of 1,250,000, and an increase of 30.0% from the June 2014 rate of 1,033,000.

Permits for future home construction increased 7.4 per cent to a 1.34 million-unit rate, the highest level since July 2007.

Single family home starts in the southern region, where most home building is known to take place, jumped to their highest level since March of 2008.

Groundbreaking for single-family homes, which account for the largest share of the market, fell 0.9 percent to a 685,000 unit pace, which was fueled by a severe drop in the Northeast.

The consensus estimate had been for a print of 1.1m. Economists also predict that housing is going to mitigate the economy’s drag which is being caused by struggling manufacturing. Groundbreaking for buildings with five units or more increased to the highest level since November 1987. This includes the most recent indicators relating to residential building permits, housing starts, and housing completions nationwide.

Trulia’s Chief Economist, Selma Hepp, dug deeper beyond the top-line numbers in the June housing starts and permits, and she drew some compelling conclusions and questions about where things are going in the second half of 2015.