Permits for New Housing Up to Strongest Level in 4 Years

Permits for New Housing Up to Strongest Level in 4 YearsPermits for housing construction in November jumped to their strongest level in more than four years, with a 3.6 percent gain to 899,000 units, according to new government data.
Meanwhile, housing starts slipped 3.0 percent to a seasonally adjusted annual rate of 861,000 units, presenting a mixed picture on the overall market for November.
However, builders are increasingly optimistic about the broader recovery. They say the slip in housing starts is more of a readjustment after big gains in September and October.
“Many builders have reported improving conditions in their local housing markets and are increasingly optimistic about the spring buying season, but they are being very careful not to get ahead of demand,” sad Barry Rutenberg, chairman of the National Association of Home Builders (NAHB) and a home builder from Gainesville, Fla. “Meanwhile, tight credit conditions are still the chief obstacle to a quicker recovery.”
Permit issuance is the key indicator of future building activity. The 3.6 percent surge was mostly due to a 10.6 percent gain to 334,000 units on the multifamily side. Single-family permits held virtually unchanged for the month, at 565,000 units.
Permits rose in all but one region in November. Gains of 8.1 percent, 2.9 percent and 5.9 percent were seen in the Midwest, South and West, respectively. A 6.2 percent decreases was recorded in the Northeast.
Single-family housing starts declined 4.1 percent to a seasonally adjusted annual rate of 565,000 units in November, while multifamily starts edged down 1.0 percent, to 296,000 units.
“The starts report for November reflects a readjustment to a more sustainable level of production following significant gains in the previous two months,” said NAHB Chief Economist David Crowe. “That said, starts in this quarter are still running well ahead of the third quarter, and we are on track for a projected 25 percent improvement in housing production for all of 2012.”

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