Builders boosted construction of new homes and apartments in October to the highest level in eight months, figures likely to feed continued growth in an already robust economy.
Housing starts rose 1.4 percent to 1.53 million at a seasonally adjusted annual rate, the most since a 1.55 million rate last February, the Commerce Department reported Wednesday.
Many analysts had expected a slight decline in housing starts after September’s 8 percent surge.
“Low mortgage rates and a lean supply of homes have provided a very favorable backdrop for housing construction,” economist David Lereah of the Mortgage Bankers Association said in explaining the advance.
“According to our mortgage applications, it is going to continue in November and December,” he added. “We may see a slowing beginning in December, but just slightly, although beginning in 1998, we’ll see a real slowing. We can’t continue this pace forever.”
Indeed, the pace began to turn around in October in the Northeast, where starts fell 15.4 percent to a 115,000 annual rate to erase an 11.5 percent September advance. Other regions posted modest increases.