US housing starts climbed 18.6 percent in January

In this Jan. 23, 2019 photo, construction workers build new housing in Salisbury, Mass. On Friday, March 8, the Commerce Department reports on U.S. home construction in January. (AP Photo/Elise Amendola)
In this Thursday, Feb. 21, 2019 photo a newly constructed homes sit near a sign, in Natick, Mass. On Friday, March 8, the Commerce Department reports on U.S. home construction in January.(AP Photo/Steven Senne)

WASHINGTON — U.S. housing starts jumped 18.6 percent in January, as builders ramped up construction of single-family houses to the fastest pace in eight months.

The Commerce Department said Friday that January ground breakings occurred at a seasonally adjusted annual rate of 1.23 million. Home construction rebounded sharply from December, when the annual rate was just 1.04 million.

The rebound after December's plunge fueled optimism among economists that new-home sales will improve in 2019. The low 3.8 percent unemployment rate has provided a stable economy that has increased interest from would-be buyers, but affordability challenges from high prices and tight inventories have restricted sales. Analysts see the possibility for new construction to ease these pressures and increase sales.

"Given the underlying strength in overall housing demand, slow and steady growth in new supply will support a modest increase in sales," said Mike Fratantoni, chief economist for the Mortgage Bankers Association.

The housing market was hurt for much of 2018 by rising mortgage rates, which made it costlier to purchase a home. But average rates have declined since early November and the average 30-year rate was 4.41 percent this week, providing a possible boost for home buying this year.

Matthew Speakman, an economic analyst for the real estate company Zillow, said that housing might still look sluggish over the next few months, but the construction gains suggest that the outlook will eventually brighten.

"I was a difficult end to 2018, but builders appear primed for better days ahead," Speakman said.

Most of the new construction came from single-family houses, which were being built at the strongest rate since May 2018. Still, overall housing starts in January were slightly below the 2018 total of 1.24 million as the pace of apartment construction slowed.

Permits for construction, an indicator of future activity, improved 1.4 percent to a seasonally adjusted rate of 1.35 million. The permits suggest additional apartment construction in the coming months, as that segmented accounted for the gains. Single-family permits fell 2.1 percent in January to an annual rate of 812,000.

Must Read

Regulators study horseshoe crab survival in...

Aug 16, 2016

Environmental regulators studying the Delaware Bay harvesting of horseshoe crabs that are drained...

Grassley: FBI improperly restricting access to...

Aug 17, 2016

A Republican senator says the FBI is improperly restricting access to materials from its closed...

South African vineyard's duck parade doubles as...

Aug 17, 2016

South African vineyard's duck parade doubles as pest control; environmentalists approve

Anti-imperialism schooling now a must for...

Aug 17, 2016

Bolivia's president inaugurates new 'anti-Imperialist' academy for military officers, where...

'Auction' of NSA tools sends security companies...

Aug 18, 2016

The leak of what purports to be a National Security Agency tool kit as part of a surreal online...

About Us

Started in 2015, Science Of The World offers in-depth news about the latest scientific discoveries. If you’re looking for a reliable source, Science Of The World is the one for you.

Contact us: sales[at]scienceoftheworld.com

Subscribe Now!