Despite spiraling mortgage rates, housing construction surged in 1994 to a six-year high and strengthened analysts’ convictions the Federal Reserve will boost borrowing costs even more to slow the economy.
The overall 1994 housing starts advance was held back slightly by a 1 percent decline in December. But the 1.53 million seasonally adjusted annual rate last month was second in 1994 only to November, when housing starts reached a 1.55 million rate.
Last year, builders broke ground on 1.45 million single-family homes and apartments, a 12.9 percent jump over 1993 and the largest number since 1.49 million in 1988, the Commerce Department reported.
Single-family starts jumped 6.2 percent to 1.20 million units, up from 1.13 million in 1993.
Regionally, the West posted the largest starts increase last year, a 16.3 percent jump to 350,900 that included a 5.6 percent gain in December.