New home construction saw an increase in June 2011 as housing starts were reported to have risen 14.6% by the U.S. Commerce Department. Total seasonally adjusted starts equalled 629,000, the highest number of housing starts since January of this year, according to a story in The News Tribune. Multi-family units surged in the month, while single-family homes saw more modest gains.
Starts in May 2011 were initially reported at 560,000 and later revised downward to 549,000. The jump in June caught analysts by surprise as they predicted 580,000 starts. Over the past year, starts have risen 16.7%, but the monthly totals are still short of what is considered a healthy market. A healthy market is one in which there are at least 1,000,000 new home starts per month.
Additionally, housing permits were also reported up in June, meaning more construction is on tap for the near future.
Housing Starts Up – What Does That Really Mean?
Previously, we posted an explanation of Housing Starts and their importance to the economy by our Director of Business Development, Mark Sprague. Sprague provides a deeper look at this important leading indicator.
The housing figures released by the U.S. Commerce department represent a nationwide snapshot of our overall economy. Keep in mind that housing numbers are extremely locally-focused. That is, sales in one state do not impact sales in another state. Prices in one city do not impact prices in another city. There is no such thing as a national real estate market, so overall numbers such as nationwide housing starts, are more an indication of overall economic health than a prediction of activity in any single area.
To read the original article in The News Tribune, please click here.
Mission Mortgage follows housing figures and statistics on a regular, ongoing basis. If you have questions about recent statistics or the importance of a specific economic indicator, send us an email at firstname.lastname@example.org and we’ll be happy to provide an answer.