April housing starts exceed expectations, soar to 7-year high
- Housing starts climbed to their highest level in seven years, the Commerce Department reported Tuesday. The 1.14 million annualized rate, a 20.2% hike, far surpassed the 1.02 million median prediction forecast by economists surveyed by Bloomberg.
- The report also revealed more building permits were issued in April than during any month since 2008—indicating more positive housing numbers are likely in the next several months.
- Multi-family home construction surged 27.2%, reaching an annual rate of 402,000, and single-family houses climbed 16.7%, to a 733,000 rate.
All regions in the U.S., except for the South, saw increases in housing starts — showing improvement across the country.
Economists point to the positive results as an indication the housing market and construction industry are finally rebounding after a disappointing start to the year. Last month, housing starts failed to meet expectations and rose only 2%.
The Commerce Department news comes one day after the National Association of Home Builders reported builder confidence unexpectedly fell in May, likely due to consumer caution.
These mixed results create an unclear picture of the future of the housing market. With this sense of uncertainy, attention will now be focused on the building data soon to be released this week: Mortgage applications will be announced Wednesday, and existing home sales numbers will be released Thursday.