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Housing may finally be driving growth in the American economy again, new numbers suggest. Construction of new single-family houses climbed at the fastest rate in nearly 30 months, surging 5.5% in August to a 535,000 annual rate, according to numbers released today.
Though total new housing starts rose 2.3% from July to August, the 750,000 annualized number was less than the 767,000 median estimate from economists surveyed by Bloomberg. Still, the stock market was up modestly in early trading, as some level of confidence reappeared in the real estate market.
Earlier this week, the National Association of Home Builders/Wells Fargo index of builder confidence showed that builder confidence levels are at their highest since June 2006, rising to 40 in September from 37 in August.
With mortgage rates near all-time lows, price levels at attractive points, and a shortage of inventory in some markets, some homebuilders are benefiting, including Toll Brothers, which is trading at a five-year high on better-than-expected results this week.