US single-family housing starts drop sharply in June

Homebuilding activity in the US slowed sharply last month.

According to the US Department of Commerce, in seasonally adjusted terms, housing starts slipped by 2.0% month-on-month to reach an annualised rate of 1.559m (consensus: 1.59m).

That put them 6.3% below their year earlier level.

Worth noting, starts for single-family homes, the most important piece of the report, dropped by 8.1% on the month before to 982,000.

Similarly, building permits, which lead starts, dipped by 0.6% versus May to hit 1.685m but that was ahead of the consensus forecast for 1.67m.

But here too, permits for new single-family homes were off by 8.0% on the month to 967,000.

"Homebuilders need to adjust rapidly to a world with fewer buyers and much more competition from private sellers of existing homes, whose listings jumped by a third in the three months to May, with much more coming," said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

"In short, housing construction is nowhere near the bottom."