Friday, January 18, 2013

Housing Becomes Economic Factor Again


Groundbreaking to build new homes accelerated in December to its fastest pace in over four years, supporting the view that housing is poised to provide a substantial boost to the U.S. economy. 

The Commerce Department said on Thursday that starts at building sites for homes surged 12.1 percent last month to a 954,000-unit annual rate. 


Data for U.S. housing starts can be volatile and is sometimes subject to large revisions. The government revised downward its estimate for November housing starts to a 851,000-unit rate from the originally reported 861,000. 

"Housing is definitely a pocket of strength. It's not only on the back on the bounce from hurricane Sandy. This was broad-based," said Yelena Shulyatyeva, U.S. economist at BNP Paribas.

Some of the strength in December's reading for starts came from a 20.3 percent surge in multi-family unit construction. That component is especially volatile. This is one market that modular construction can be more than a 3% contributor!


Wednesday's report nonetheless builds on a trend in growth that has led many analysts to expect residential construction boosted the economy last year for the first time since 2005. 

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