Washington, DC, Oct. 17--Home-building activity in September rebounded to its second- highest level this year, showing that the housing sector continues to bolster the overall U.S. economy.
Housing starts rose by a larger-than-expected 3.4% to a seasonally adjusted 1.888 million annual rate, the Commerce Department said Friday. This follows a revised drop of 3.4% in August to a 1.826 million rate. August starts were previously reported as falling 3.8% to a 1.82 million annual rate. September's report reflected the industry's second best performance since hitting a 17-year high in July, which was revised to a 1.89 million annual rate.
The report was much stronger than analysts had expected. A Dow Jones Newswires-CNBC poll of 18 economists predicted housing starts would rise by only 0.3% to a 1.825 million annual rate.
The housing sector of the U.S. economy has remained strong for the past several years and has defied analysts' expectations as it weathered the 2001 recession, and is credited for the economy's modest recovery since then.
The September report showed that building permits, an indicator of future building activity, dropped off by 2.2% to a 1.86 million annual rate.
The report showed that single-family starts rose by 3.1% while multifamily starts, or starts on apartment buildings, were unchanged from August.
Housing starts rose in all regions except for the South, where they fell by 1.3%. Housing starts jumped by 15.1% in the Northeast, increased by 8.1% in the Midwest and rose by 4.2% in the West.
September housing starts increased 4.3% from a year ago. An estimated 168,100 houses were actually started, based on seasonally unadjusted figures. An estimated 161,400 building permits were issued in September, also based on unadjusted figures.
