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Despite housing starts exceeding expectations in May, the share of housing permits dropped for the second month in a row, curbing market expectations.
Last month, building permits went down 4.6 percent to a rate of 1.301 million units, matching September 2017's low, but still higher than previously anticipated by economists, per Reuters. Single-family home permits went down 2.2 percent, also hitting the September 2017 low. According to CNBC, the single-family sector has, "lost momentum since hitting a pace of 948,000 units last November, the strongest in more than 10 years." Housing starts, in contrast, rose 5 percent in May, per Department of Commerce data.
A survey on Monday showed confidence among single-family homebuilders dipped in June, with builders "increasingly concerned that tariffs placed on Canadian lumber and other imported products are hurting housing affordability." According to the survey, the expensive lumber had "added nearly $9,000 to the price of a new single-family home since January 2017." The Trump administration in April 2017 imposed anti-subsidy duties on imports of Canadian softwood lumber. More expensive lumber together with a lack of land and labor have worsened an acute shortage of homes for sale, hobbling the housing market.
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