Housing starts increased 6.3% in June to a seasonally adjusted annual rate of 1.64 million, the U.S. Census Bureau and U.S. Department of Housing and Urban Development reported.

The rate increased 29.1% compared with June 2020.

While housing start rates increased, building permits fell 5.1% compared with May to a rate of 1.59 million. The rate was 23.3% higher than June 2020 rates, when the market was still stifled by the COVID-19 pandemic. 

"The recent weakening of single-family and multifamily permits is due to higher material costs, which have pushed new home prices higher since the end of last year," stated Robert Dietz, chief economist with the National Association of Home Builders. "This is a challenge for a housing market that needs additional inventory."

Housing completions dropped 1.4% month-over-month to a rate of 1.32 million, but increased 6.5% year-over-year. 

Regionally, housing starts declined 9.0% in the Northeast and 7.5% in the Midwest. Housing starts increased 9.7% in the South and 12.6% in the West.

The full report can be found here.