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Housing starts reach four-year high in September
According to Bloomberg.com, figures from the Commerce Department indicate housing starts reached an 872,000 annual rate in September, the most since July 2008.
According to Bloomberg.com, figures from the Commerce Department indicate housing starts reached an 872,000 annual rate in September, the most since July 2008. A Bloomberg survey of economists indicated a median estimate of 770,000.
In the last year, work began on 34.8 percent more homes. This indicates the biggest year-over-year gain since April.
Additionally, building permits reached an 894,000 annual rate, the highest since July 2008 and also exceeding the median forecast. The number of building permits increased by 45.1 percent since September 2011.
“The housing market certainly has turned,” said Brian Jones, a senior U.S. economist at Societe Generale in New York. “But we still have a long way to go. The good thing is that construction will pull employment with it.” Jones’ estimate of 790,000 was among the highest.
The increase in home starts and future home planning may be due to record-low mortgage rates and housing prices brought on by the recession, according to Bloomberg. Also, the number of households in the U.S. grew 2 percent in 2011, which may also have contributed to the rise. However, the level of housing starts remains below the pre-recession peak, likely due to the nation’s unemployment rate.