Housing starts up 5.3% in November -
Tuesday, December 20, 2005 4:36:17 PM
WASHINGTON (AFX) - New construction of U.S. homes rebounded in November, the Commerce Department said Tuesday. Construction of new homes rose 5.3% to a seasonally adjusted annual rate of 2.123 million units
Economists surveyed by MarketWatch were looking for a smaller increase to about 2.02 million starts in November. October's housing starts were revised slightly higher to 2.02 million from 2.01 million. Building permits -- which foreshadow future activity -- increased 2.5% to 2.16 million annual units. "Housing once again shows its strength -- the zombie market that just won't die," said Robert Brusca, chief economist at FAO Economics in New York
Treasury Secretary John Snow said 2005 is on track to be a record year for housing starts. "With permits to build continuing to exceed starts, it appears as if residential construction will remain robust," he said. Starts of single-family homes rose 4.8% to a 1.81 million pace. Starts of multifamily homes sank 14.8% to 310,000
Bear Stearns economists said starts could rise further in December due to the high level of November permits activity. The government's housing data are subject to large sampling and other statistical errors. The government cautions that it can take up to five months for a new trend to be established in housing starts. In a separate report, the Labor Department said prices at the producer level had their largest decline in 31 months in November. "This morning's economic releases confirm that inflation remains muted as the November PPI came in down 0.7%," said John Wilson of Morgan Keegan. "Housing starts and building permits were also stronger than expected, indicating that reports of their demise may be premature."
This story was supplied by MarketWatch. For further information see www.marketwatch.com
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