New housing starts in the United States during November surged 22.7% higher than the October rate, hitting its best level in five-years, according to new figures released by the U.S. Commerce Department.
It hit an annual rate of 1.1 million and is 29.6% higher than the rate from November 2012.
Starts for single-family homes rose 20.8% in November to a rate of 727,000, the highest since March 2008, while starts in buildings with at least five units rose 26% to a rate of 354,000.
The number of building permits issued during November, an indicator of future activity, fell 3.1% in November from October to an annual rate of 1 million, but is 7.9% higher than the same time a year ago and remains near a five-year high.
Permits for single-family homes rose 2.1% to a rate of 634,000, the highest rate since April 2008, while permits for buildings with at least five units dropped 11.5%, leading to the overall decline
This follows a separate report on housing from the National Association of Homebuilders showing homebuilder optimism in the market for newly built, single family homes increased this month. This gain reflected improvement in all three of the group’s index components – current sales conditions, sales expectations and traffic of prospective buyers.
“The recent spike in mortgage interest rates has not deterred consumers as rates are still near historically low levels,” said NAHB chief economist David Crowe. “Following a two-month pause in the index, this uptick is due in part to release of the pent-up demand caused by the uncertainty generated by the October government shutdown. We continue to look for a gradual improvement in the housing recovery in the year ahead.”
Meantime a separate reporter released Monday shows inflation is anything but a threat for the U.S. economy, with consumer prices in November staying put from the month before.
The main reason was a drop in gasoline prices, falling 1.6%, according to the U.S. Labor Department.
Excluding the volatile food and energy sectors consumer prices overall for November rose 0.2% from October and is 1.7% higher over the past 12 months.
Overall, consumer prices are up only 1.2% over the past