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U.S. homebuilding soars in January

Staff Writer |
U.S. homebuilding rose to more than a one-year high in January, boosted by strong increases in the construction of both single- and multi-family housing units.

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Housing starts jumped 9.7 percent to a seasonally adjusted annual rate of 1.326 million units, the Commerce Department said. That was the highest level since October 2016 and followed an upwardly revised sales pace of 1.209 million units.

Building permits surged 7.4 percent to a rate of 1.396 million units in January, the highest level since June 2007.

A tightening labour market is boosting demand for housing, but rising mortgage rates and house prices could slow the momentum. Despite the unemployment rate being at a 17-year low of 4.1 percent, annual wage growth has not exceeded 3 percent.

In contrast, the annual house price increase topped 6 percent in November. The 30-year fixed mortgage rate rose to an average of 4.38 percent this week, the highest level since April 2014, from 4.32 percent in the prior week, according to mortgage finance agency Freddie Mac.


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