New home starts on private residences have been teetering over the past few months, but rose 6.8% from the revised April estimate of 856,000, reaching 914,000 in May. 

Housing starts year-over-year increased 28.6% from the May 2012 rate of 711,000, according to data from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development. 

"Housing appears to still be on a moderate uptrend-but the numbers have been volatile and monthly averaging seems like a good idea," commented analysts at Econoday.

Building permits for privately-owned housing units were at a seasonally adjusted annual rate of 974,000 in May, a 3.1% drop from the revised April rate of 1.01 million. However, this is 20.8% higher than the May 2012 estimate of 806,000 permits. 

House completions in May were at a seasonally adjusted annual rate of 690,000 units, 0.9% below the revised April estimate of 696,000. May’s numbers were still 12.6% higher than the May 2012 rate of 613,000 completions.

Single-family authorizations rose 1.3% from April’s revised 614,000 to a rate of 622,000 in May.

"Overall, both single-family and multifamily components are adding-on average-to moderate growth in the housing sector," Econoday analyst noted. "This is one sector of the economy where the Fed's quantitative easing is showing a clear and positive impact and likely will be mentioned in tomorrow's FOMC statement."

The Standard & Poor’s baseline economic forecast expects an increase in total housing starts of about 28% this year, to one million units. In 2014, another 29% increase is anticipated, with starts reaching 1.3 million units.