Monday, December 21, 2009

Housing Starts Jump 8.9 Percent in November

More good news, this time from Housing Zone:

According to the U.S. Census Bureau’s new residential construction report, housing starts rose 8.9 percent to a seasonally-adjusted annual rate of 574,000, the highest level in a year and a stronger jump than most economists expected. This was a welcome rebound, considering construction on U.S. housing units dropped sharply in October.

Extension and expansion of the first-time home buyer $8,000 tax credit, lower home prices, looser credit conditions and low interest rates are expected to further drive sales and construction in coming months. Economists also believe the Federal Reserve will keep interest rates low to stimulate mortgage lending.

Other highlights from the report include:

• Building permits rose 6 percent to a seasonally-adjusted annual rate of 584,000 in November, which indicates builders are lining up future work.

• Construction of single-family houses rose 2.1 percent to a 482,000 rate, well above the low of 357,000 starts in February.

• Multifamily starts jumped 67 percent to an annual rate of 92,000—although an encouraging sign, this sector is still on a downward trend from the 189,000 high reached in early 2009.

• All four regions showed gains in housing starts in November, led by the Northeast (16 percent increase) and followed by the South (12 percent), the Midwest (3 percent) and the West (1.9 percent).

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