Permits To Build New Homes Surge In May

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The number of building permits authorized in May rose 11.8 percent from the month before, according to new estimates released by the U.S. Census Bureau and the Department of Housing and Urban Development. Permits are now 25.4 percent higher than they were last year at this time. The improvement suggests construction of new homes will continue to increase in the coming months – yet another encouraging sign that the housing market’s rebound is taking hold. New home construction is seen as a good indicator of both the economy and housing market’s health because it creates jobs and means demand is high among interested buyers. It also adds to the number of homes available for sale, which will help moderate price increases in markets where low inventory is leading to higher home prices. But despite the rising number of permits in May, housing starts – which measure how many new homes broke ground during the month – fell from April’s total. Still, industry analysts believe the decline will only be a temporary setback due to the significant increase in building permits seen in May. More here.

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