After housing starts showed modest month-to-month improvement yesterday, rising in May to a seasonally adjusted annual rate of 560,000, the National Association of Home Builders (NAHB) expressed concerned over the pace of economic growth.
"While the upward movement registered in today's report is somewhat good news, housing production continues to bounce along the bottom near historic lows, and is only running at a level necessary to replace dilapidated or destroyed units," said Bob Nielsen, chairman of the NAHB and a home builder from Reno, Nev.
Single-family housing starts rose 3.7% to a rate of 419,000 units in May -- their strongest pace since this January. Multi-family starts rose 2.9% to a 141,000-unit rate in May.
"Like consumers, builders remain very concerned about the pace of economic growth and are awaiting signs of improvement before moving forward with new projects," noted NAHB chief economist David Crowe. "The relative bright spot in new-home construction is on the multi-family side, where improving demand for rental apartments is spurring gains in that sector. However, access to construction credit remains a limiting factor for new building."