U.S. housing starts rose more than expected in June as construction activity increased broadly, but a downward revision to the prior month's data pointed to a housing sector treading water in the second quarter.
Groundbreaking surged 4.8 percent to a seasonally adjusted annual pace of 1.19 million units, the Commerce Department said on Tuesday. May's starts were revised down to a 1.14 million-unit pace from the previously reported 1.16 million-unit pace.
Economists polled by Reuters had forecast housing starts rising to a 1.17 million-unit pace last month.
Housing starts in the second quarter were a touch higher than the average for the first three months of the year, suggesting that residential construction was probably a small boost to gross domestic product in the second quarter.
The housing market is being supported by a strengthening labor market and demand for rental accommodation, but home building is being constrained by labor and land shortages.