Housing starts jump nearly 7% in June

Posted on July 19th, by Administrator in News. No Comments

In the Twin Cities and across the country, tight supplies of existing homes and record low mortgage rates have been a salve for home builders, who are beginning to hammer their way out of the deepest downturn in generations.

U.S. housing starts increased 6.9 percent in June to a seasonally adjusted annual rate of 760,000, the highest level since October 2008.

“We could get used to this trend,” said Curt Christensen, president of the Builders Association of the Twin Cities (BATC) and owner of Lee Lyn Construction. “We’re seeing plenty of signs of improvement in housing.”

The rising number of housing starts is the latest in a bevy of positive reports that shows the residential real estate market is strengthening, even as global economic jitters dominate the broader economy. Home sales and prices have begun climbing in the past quarter, stirring hope for the construction industry as well.

“Housing continues to be the one sector of the U.S. economy that is outperforming expectations,” said Michael Gapen, an economist at Barclays.

In June, permits in the Twin Cities were up 80 percent compared with the same time last year, punctuated by strong demand for single-family houses and rental apartments, according to the BATC. Twin Cities builders were issued 465 permits to build 555 units. (A single permit can be issued to build more than one unit.)

There are plenty of long-term indications that the market is turning. The Twin Cities office of Metrostudy, a national construction research firm, said Twin Cities home builders are having their best year since 2007, including a 45 percent increase in starts during the first six months of the year vs. 2011.

Such trends aren’t only lifting sales, they’re lifting spirits. On Tuesday, the National Association of Home Builders said that its housing market index this month jumped to its highest level since March 2007, the largest monthly increase since September 2002.

The New York Times contributed to this report. • StarTribune

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