Single-family housing starts fell for the 13th straight month in May, a sign that residential construction remains a significant drag on the U.S. economy.
Overall housing starts -- including multifamily units -- totaled a seasonally adjusted annualized rate of 975,000, which was down 3.3% from April and down 32.1% from a year ago, the Census Bureau said Tuesday.
New permits, an indicator of future demand, totaled an annualized rate of 969,000, which was down 36.3% from last year.
Both numbers were essentially in-line with economists' expectations.
Wachovia economic analyst Adam York says new construction activity will continue to decline into the summer, and he expects a weak to nonexistent recovery after that.
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The weakness in the housing starts remains a Catch-22 for homebuilders. "In some ways, you need the declines to help the supply-demand imbalance you have in the marketplace. But obviously the declines hurt builders and the economy that that supports," York says.
In premarket trading Tuesday,
and other homebuilders were trading flat.