Housing starts slump 6.5% in May

Economists were expecting housing starts to back down in May, but not this much.

The U.S. Census Bureau and Department of Housing and Urban Development reported starts at a seasonally adjusted annual rate of 1,001,000, 6.5% below the revised April estimate of 1,071,000.

Though May's figure still broke the million-starts mark, economists were generally predicting a month-over-month drop of 3.9% to 1.03 million starts.

Single-family housing starts fell, but not by as much. At a rate of 625,000, they were down 5.9% from April's revised figure of 664,000.

Permits lagged behind as well, down 6.4% month-over-month and 1.9% year-over-year to a seasonally adjusted annual rate of 991,000. In a small bit of good news, single-family permits were up 3.7%, suggesting latent demand.

Additionally, this month's overall housing starts pace is still 9.4% above May 2013's rate of 915,000.

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