The Census Bureau reported that housing starts jumped from 627,000 in October to 685,000 residential units in November. Both single-family and multi-family units were higher, but multi-family starts increased the most. New multi-family residential construction rose from 190,000 to 238,000 for the month, its highest level since autumn of 2008. Meanwhile, single-family construction grew to 447,000 from 437,000 the previous month.
Regionally, only the Midwest is experiencing slower housing starts. The Northeast and West had the fastest monthly growth in new residential construction, with the South also higher.
Housing permits were also higher, up to 681,000 from 644,000, largely on strength in the multi-family residential sector. This bodes well for new construction moving into 2012. Total completions – a lagging indicator – fell 5.6 percent in November to 542,000 units.
Overall, these numbers are positive news to end the year on. The National Association of Home Builders released similarly upbeat news yesterday. A stronger housing market will be vital to the long-term health of the manufacturing sector and the overall economy, and recent data have tended to show the sector in edging higher. Given continuing weaknesses in the housing market and headwinds elsewhere, it is clear that there is still a long way to go, though.
Chad Moutray is chief economist, National Association of Manufacturers.