(Bloomberg) -- U.S. new home construction rose more than forecast to a nine-month high in November, highlighting the strength of a residential housing market that’s been supported by strong demand amid low interest rates.
Residential starts rose 1.2% to a 1.547 million annualized rate from an downwardly revised 1.528 million a month earlier, according to government report released Thursday. The median estimate in a Bloomberg survey of economists called for a 1.535 million pace.
The figures underscore strong demand for new homes thanks to record-low mortgage rates and buyers looking for bigger spaces during the pandemic. Housing has been a bright spot in the economy, with new home construction now nearly back to February’s level.
Still, housing may face headwinds as the worsening spread of the virus prompts fresh restrictions and stimulus talks in Washington remain unresolved.
Single-family starts rose for a seventh month to a 1.186 million annualized rate that was the highest since 2007, while starts for projects with five or more units, a category that tends to be volatile and includes apartments and condos, increased to 352,000.
A separate report Wednesday showed that U.S. homebuilder confidence eased slightly in December to the second-best level on record following the prior month’s peak.
Meanwhile, a separate report Thursday showed that applications for U.S. unemployment benefits unexpectedly jumped last week to the highest level in three months.
Strength new construction was broad-based nationally. Housing starts climbed in all four regions, led by a 12.9% rise in the Northeast, according to the report, which is published jointly by the Census Bureau and the Department of Housing and Urban Development.
Applications to build, a proxy for future construction, rose to 1.639 million, the highest since 2006.
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