Washington, DC, Dec. 17--U.S. housing starts rose 2.4% in November, only partially reversing a big slide the month before, as low mortgage rates lured buyers. However, permits, an indication of builder confidence in future home building prospects, fell 2.7% to 1.725 million units last month.
Ground breaking for new homes climbed to a seasonally adjusted annual rate of 1.697 million units last month from an upwardly revised 1.657 million rate in October. The increase was ahead of the expectations of analysts polled by Reuters, who had forecast a 1.672 million unit rate.
Kevin Logan, an economist with Dresdner Kleinwort in New York, said overall housing starts were relatively strong last month. "What it suggests is the housing sector is the one bright spot in the economy, and that's reflecting low mortgage rates."
Housing starts had fallen a revised 8.4% in October after surging 10.9% in September. Economists have said the October slip could have been caused by a wet month, and added fundamentals supporting housing, strong demand, attractively low mortgage interest rates, showed little signs of flagging.
Single family home starts, the biggest building category, rose a modest 0.9% to 1.390 million units last month. Multifamily starts jumped 12.6% to 278,000 units.
Regionally, starts surged 10.1% in the South, the biggest region for home building, and 10.9% in the Midwest. However, ground breaking for new homes tumbled 11.9% in the West and 5.6% in the Northeast.
