Construction Boom Bodes Well For Housing

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New estimates from the U.S. Census Bureau and the Department of Housing and Urban Development show new residential construction rose 9.8 percent in June and is now 26.6 percent above last year’s level. The improvement, though largely due to a spike in multi-family housing, is good news for the overall market and a reflection of how much demand has increased due to gains in the job market. Better employment conditions have caused an increasing number of Americans to begin looking for a home of their own and particularly among first-time home buyers. This, along with the rebounding confidence of home builders, signals continued improvement for the housing market over the months ahead. In fact, building permits – which are a good indicator of future home construction – rose 7.4 percent over May’s rate and are now 30 percent higher than they were last year. This is an indication that new home construction will continue to see gains through the second half of the year. June’s results surpassed economists’ expectations and added to the recent evidence that local housing markets across the country are continuing to strengthen. More  here.

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