Housing starts fell slightly in May
In June, the US market started on a positive note. There was optimism that the Fed would deliver some good news in its meeting this week. After the retail sales report last week, the economy breathed a sigh of relief. The retail sales report showed positive consumer confidence. On June 18, the U.S. Census Bureau and the Department of Housing and Urban Development announced the housing data for May.
The data shows new residential construction statistics. After rising in April, housing starts fell 0.9% in May to a seasonally adjusted annual rate of 1.27 million units. The data was below the estimate of 1.24 million units in Bloomberg’s survey. A drop in the construction of single-family housing units caused the decline. The data for April was revised up to show an increase of 1.281 million units.
The report stated the following:
- Single-family construction fell 6.4% month-over-month to a rate of 820,000 units in May.
- Building permits rose 0.3% to a rate of 1,294 thousand units in May.
On June 18, a Reuters said that a previous survey showed how homebuilders’ confidence is fading away. Development and construction costs are increasing due to the trade war. The 30-year fixed mortgage rate has fallen to 3.8% from 4.9% in November, according to data from mortgage finance agency Freddie Mac. The SPDR S&P 500 ETF (SPY) tracks the S&P 500 Index. SPY has risen 16.3% YTD and gained 0.97% on June 18.