Housing starts rose 6.9 percent in June, one more sign of a recovery in the housing market. Learn more about the trend.
Construction of new homes jumped 6.9 percent in June, according to data released today by the U.S. Department of Commerce in a report adding to growing evidence that the housing market is continuing its modest recovery.
Housing starts were a seasonally adjusted annual rate of 760,000 in June, according to the Commerce Department, a 23.6 percent increase from the June 2011 rate of 615,000. New construction of single-family homes was up 4.7 percent from May.
The rate of building permits fell 3.7 percent from May to June to a seasonally adjusted annual rate of 755,000. Building permits, viewed as a forward-looking indicator for the housing market, were 19.3 percent higher than June 2011.
“This is one more piece of evidence that housing is starting to take back its traditional role of leading the nation out of recession, and tracks with our forecast for continued improvement in new construction through the end of this year,” David Crowe, chief economist for the National Association of Homebuilders, said in a statement released today.
The pace of new construction is the fastest the housing market has seen since April 2010, according to the homebuilders association. The West and Northeast saw double-digit increases of 22.2 percent and 36.9 percent, respectively in new home construction, while the Midwest and South saw a decline of 7.3 percent and 4.2 percent, respectively.
“This good report is in keeping with the results of our latest builder confidence survey, in which many of our members said that they are seeing an influx of more serious buyers to the new-homes market this summer,” Barry Rutenberg, chairman of the NAHB, said in a statement.
Home builders’ confidence is at a five-year high, according to the July Housing Market Index reported by the NAHB yesterday. The 6-point jump from June to July, the biggest one-month gain in nearly 10 years, puts the index at its highest point since March of 2007.
Record-low interest rates, the result of federal monetary policy, combined with depressed prices are key factors stimulating the housing market.