Consumers continue to spend their way out of the recession and new figures show housing is still the hottest market.

This morning the U.S. Commerce Department reported February housing starts climbed to a seasonally adjusted annual rate of 1.769, an increase of 2.8% from an upward revised January total and 9.8% above the 2001 monthly average.
Overall February starts were the highest since December 1998, while starts of single-family homes were the highest since November 1978.
“The spurt in housing is likely not over yet,” says Newport Communications Senior Economist Jim Haughey. “Continued strength in the housing market will pull extra loads of building materials and household goods through the distribution system.”
Haughey says winter surges in housing starts in the past have been due largely due to unseasonably warm weather.
“This has been a warm winter. But the recent rise in starts has largely been in the South and the Pacific states where cold weather has less impact on construction than in the Midwest or Northeast,” he says.
As for the near-term future for new home starts, things also look good. Building permits, which usually lead housing starts by a month, rose in February to 1.752 million, up from 1.721 million in January.
“Homebuyers will still be reacting for several more months to last years' cuts in credit costs and income tax rates,” Haughey says.