Ladies and gentlemen, the U.S. housing market really is back
Housing starts came in at a post-2008 high
Builders work on the roof of a new housing construction site in Alexandria, Virginia October 17, 2012. Groundbreaking on new U.S. homes surged in September to its fastest pace in more than four years, a sign the housing sector’s budding recovery is gaining traction.
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To recap:
- December housing starts came in at a seasonally adjusted on a annual rate of 954,000, an increase of over 12 per cent from November and up nearly 37 per cent from December of last year, the U.S. Department of Commerce said today. The figure was far higher than the consensus forecast of 890,000 starts and the strongest reading since mid-2008. It also represents the largest monthly jump since May 2006.
- Building permits for private residential construction were at a seasonally adjusted annual rate of 903,000, up a small tick from November, but nearly 29 per cent above December 2011.
What the analysts are saying:
Today’s release is further confirmation that the residential real estate market is back to being a key engine of growth for the U.S. economy, writes RBC’s David Onyett-Jeffries. The real estate comeback is starting to show in the labour market as well, notes TD’s Michael Dolega, with construction employment up by 30,000 in December in a the sector that has shed around two million jobs since 2006-2007 . Although the modest increase in building permits foreshadows a slowdown in new construction in the next few months, Dolega predicts the annual pace of home construction will reach one million by the end of the year providing jobs for half a million Americans.