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Housing Starts Highest in Four Years

Housing Starts Highest in Four Years

In a positive sign for economic growth, housing starts in June jumped 6.9 percent, to their highest level since 2008.

Construction was at a seasonally-adjusted pace of 760,000 homes per year, and rose in every region of the country. Additionally, May housing starts were revised upward to a 711,000 homes-per-year pace. The rate of construction slightly outpaced Wall Street expectations.  The consensus of economists was that housing starts would be at 750,000 homes-per-year.

New housing permits fell 3.7 percent, reflecting a drop in new permits for apartment buildings.

The housing rate is higher than at any point since October of 2008, just after the start of the financial crisis. Construction has been spurred by lower interest rates and pent-up demand.

In an interview with USA Today, TD Bank economist Martin Schwerdtfeger said, “This was a good report overall.” Noting that permits for new construction remain high, Schwerdtfeger said the report “suggests that the momentum in building activity observed in recent months should carry forward.”

While the report was positive, it was still anemic by historical standards. Nevertheless, the continued growth is positive for the economy; each new home built generates three jobs for a full year, and $90,000 in tax revenue.

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12 comments

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4:29PM PDT on Jul 21, 2012

With all the regional fires, "natural" disasters, and the like, it is no wonder that building starts are up, if ever so slightly.

Yet thousands of American homes remain shuttered, and with each passing day, they fall further into disrepair and ruin.

I have witnessed the building of those hideous, people cramming, apartment building that "they" like to call Condos.

My advise, buckle up...the worse is coming and it will not be a pretty sight. Be Safe.

5:24PM PDT on Jul 20, 2012

Jamie, yep, we have lots of houses for sale here too, yet so many trees are being cut down so builders can build new houses, and make shitloads of money, while paying minimum wages to those who do all the hard work. We have many military families in our neighborhood, forced to move, way too often, having to sell their houses, losing money all too often, and now having to compete with all the builders who are building houses they flood the market with.

4:46PM PDT on Jul 20, 2012

Can't wait to see how Romney spins this bit of good news. Thanks Jeff for the article.

3:05PM PDT on Jul 20, 2012

A green star to you, Lisa L. Just what we need, huh?---more so-called "development" destroying even more "undeveloped" land across the country to accommodate an ever increasing number of people. As Edward Abbey once said, "Growth for the sake of growth is the ideology of the cancer cell".

11:12AM PDT on Jul 20, 2012

Home values still going down down down and they want to build more?

11:11AM PDT on Jul 20, 2012

WTF. when we have houses sitting empty by the thousands that are foreclosed on, why are we building more of them?

8:11AM PDT on Jul 20, 2012

Not good enough!

7:55AM PDT on Jul 20, 2012

I should think it would be better news by far if old housing were rehabilitated and restored instead. I see absolutely nothing positive about the new housing developments sprawling across the landscape like a cancer.

4:57AM PDT on Jul 20, 2012

That's good news and the first step. The second step is for banks to make mortgages. The third step is for people to get a job so they can buy the house that was started. I believe it would have been better to make the third step the first step instead of the third step. Some people may have wanted to buy food for their family and a car to drive to work before buying a house.

1:28PM PDT on Jul 19, 2012

In the last few months, hundreds of homes were lost to tornadoes and fires. When these homes are replaced with new homes, building codes need to prevent construction of more "stick" houses that may be lost again in a repeat disaster. There are many new building techniques, such as earth-sheltered homes, that make new houses generally safe from tornadoes, fires, and other natural disasters. We don't have enough resources to constantly replicate past mistakes.

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