Housing starts increased in April 2.6 percent to a seasonally adjusted annual rate of 717,000 homes, the Commerce Department reported. March starts were revised from 654,000 to 699,000.
Demand for rentals is helping to prop up the housing market, which collapsed six years ago.
In other encouraging news that signals that the housing market recovery is gaining some footing is a Mortgage Bankers Association report that the U.S. mortgage delinquency rate declined in the first quarter to its lowest level in four years. The share of home loans at least 30 days late dropped to 7.4 percent from 7.58 percent.
The rate peaked at 10.1 percent in the first quarter of 2010, and was last lower in the third quarter of 2008, when it was 6.99 percent, Bloombergreported. Earlier this week, the National Association of Home Builders reported that builder confidence in the market for new single-family homes gained five points in May to reach the index’s strongest reading in five years.
Building permits in April, however, were at a seasonally adjusted annual rate of 715,000, a 7 percent drop from the revised March rate of 769,000 (a four-year high), but 23.7 percent above the revised April 2011 rate. Permits to build single-family houses in April were at a rate of 475,000, a 1.9 percent above the revised March figure of 466,000.
The Commerce Department’s housing starts report eases concerns somewhat that the warm winter had accelerated hiring and homebuilding in January and February at the expense of March activity. But housing starts do remain less than a third of their peak six years ago.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.