U.S. builders started work on slightly fewer homes in February. But they began laying the ground work for a turnaround later this year by requesting the most building permits in any month since October 2008, the Associated Press reports.
The Commerce Department said today that builders broke ground on a seasonally adjusted annual rate of 698,000 homes last month. That’s down 1.1 percent from January’s revised level of 706,000, also the highest since October 2008.
Building permits, a gauge of future construction, jumped 5.1 percent last month to 717,000. Two-thirds are for single-family homes, which are critical to a housing recovery.
It can take up to 12 months for a builder to obtain a permit and construct a single-family home.
The housing market still has a long way to go before a full recovery is under way. The current pace of construction is barely half the rate considered healthy, as are the number of permits being requested. Most analysts say it could be years before the industry returns to full health.
Construction of single-family homes, which makes up roughly 70 percent of housing starts, dipped in February to 457,000 after rising for four straight months to an 18-month high. A jump in volatile apartment construction offset the decline.
A mild winter allowed builders to keep working in most parts of the country. And an improving job market has many slightly more optimistic about home sales this year.
Builders are starting to see some signs of progress. They are more confident after seeing more people express interest in buying a home. Mortgage rates are hovering near record lows below 4 percent. And home sales started to rise at the end of last year.