Housing starts fell for three straight months after hitting a 33 year high in January, a fact that many analysts took as a sign that the housing market was slowing significantly. The month of May, however, brought some good news to the sector as home construction exceeded most Street expectations and rose 5% to an annualized rate of 1.957 million units, according to the U.S. Commerce Department.

The rate rebounded in May from a 13-month low, largely due to the fact that builders worked on backlogs and used incentives such as free car leases to win new business in the less robust market.

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