Groundbreaking for new U.S. home construction slumped 6.5% in May to a seasonally adjusted annual rate of 1.001 million units as building permits dropped 6.4% to an annual rate of 991,000 units, according to Commerce Department data released Tuesday.

The rate for housing starts fell short of the 1.036 million level predicted by Thomson Reuters' poll of economists. Thomson had projected a 1.055 million rate for permits.

The increase in starts follows a 12.7% rise in April to 1.071 million units, originally reported as a 13.2% gain to 1.072 million units. In April, permits were up 5.9% to 1.059 million units, first reported as an 8.0% climb to 1.080 million.

Year-over-year housing starts were up 9.4%, when 915,000 units were started. The permits figure was 1.9% worse than the year-ago rate of 1.010 million.

In the regions, home starts in the northeast slumped 25.2% to 95,000. In the midwest sales plunged 16.5% to a 172,000 rate. In the west, starts fell 16.3% to 205,000 units, while in the south, starts rose 7.3% to 529,000 units.

Meanwhile, permits grew 3.8% in the Midwest to 166,000, in the northeast permits increased 3.5% to a 117,000 rate, in the south permits fell 7.3% to 485,000, while permits were off 15.2% in the west to 223,000.

Gary Siegel is online editor for The Bond Buyer

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