US: Housing starts likely to post 3% increase in May – Nomura

Analysts at Nomura expect a 3.0% m-o-m increase in US housing starts to 1325k saar in May, from 1287k in April.

Key Quotes

“Housing starts slowed in April, driven by a sharp 11.3% decline in volatile multifamily starts. We think multifamily housing starts rebounded strongly in May, consistent with their tendency to mean revert.”

“For single-family housing starts, we expect steady growth in May. Consumer demand for new housing likely remained strong. Positive backward revisions, released with the April housing starts report, suggest firm momentum. On building permits in May, we expect a 1.5% m-o-m increase to 1385k saar, from 1364 in April.”