U.S. May Housing Starts and Permits - Multiple starts plunge, elsewhere moves were modest
May housing starts are sharply weaker than expected, down 15.4% to 1.177m, the weakest since May 2020 during the pandemic. However the fall was largely due to a 40.2% plunge in the volatile multiples sector. Single starts fell by a modest 1.9%.
The single starts decline still takes the level to the weakest since September 2025 and there may be some loss of underlying momentum, with mortgage rates having been lifted by reduced hopes for Fed easing, though the slowing is quite modest, as is the case in most housing sector indicators. Single permits actually increased by 0.6%, their first rise in three months.
Overall permits saw a modest 0.6% decline on a 2.8% decline in multiples. Multiple starts unusually moved ahead of multiple permits in March and had been trending higher, but that uptrend saw a sharp reversal in May, with multiples starts falling to their lowest level since November 2024.
The picture in permits looks fairly stable for both singles and multiples. The plunge in multiple starts is likely to prove erratic though a return to recent highs is unlikely in the near term. Single starts have fallen marginally below permits which they usually trend marginally above, and seem to be in a correction from a particularly strong March.
