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U.S. house building permits reach 12-year high

Christian Fernsby |
New residential construction in the U.S. soared more than expected in the month of November, according to a report released the Commerce Department.

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Topics: U.S.    HOUSE   

The report said housing starts surged up 3.2 percent to an annual rate of 1.365 million in November after spiking 4.5 percent to a revised 1.323 million in October.

Economists had expected housing starts to jump 2.4 percent to a rate of 1.345 million from the 1.314 million originally reported for the previous month.

Housing starts rose for the second straight month following a sharp pullback in September, climbing back near the twelve-year high of 1.375 million set in August.

Single-family housing starts shot up 2.4 percent to a rate of 938,000 in November, while multi-family starts spiked 4.9 percent to a rate of 427,000.

Building permits, an indicator of future housing demand, also climbed 1.4 percent to an annual rate of 1.482 million in November after soaring 5 percent to a rate of 1.461 million in October.

The continued increase came as a surprise to economists, who had expected building permits to slump 3.5 percent to a rate of 1.410 million.

With the unexpected increase, building permits reached their highest level since hitting a rate of 1.493 million in May of 2007.

Multi-family permits led the way higher, jumping 2.5 percent to a rate of 564,000 in November. Single-family permits rose 0.8 percent to a rate of 918,000.

Compared to the same month a year ago, housing starts in November were up 13.6 percent, while building permits were up 11.1 percent.

A separate report released the National Association of Home Builders on Monday unexpectedly showed a substantial improvement in U.S. homebuilder confidence in the month of December.

The report said the NAHB/Wells Fargo Housing Market Index spiked to 76 in December from an upwardly revised 71 in November.

Economists had expected the index to come in unchanged compared to the 70 originally reported for the previous month.

With the unexpected jump, the housing market index reached its highest level since hitting 77 in June of 1999.

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