The pace of U.S. home construction jumped in April to its highest level since November, exceeding all analysts’ forecasts and showing builders returned to sites after freezing temperatures restrained work earlier this year.
Housing starts climbed 13.2 percent to a 1.07 million annualized rate following March’s 947,000 pace, the Commerce Department reported today in Washington. The median estimate of 79 economists surveyed by Bloomberg called for 980,000. Permits for future projects increased, a sign activity might accelerate in coming months.
A recent drop in borrowing costs and a loosening of credit conditions are poised to lure more buyers into the market and lift demand for builders. Hiring gains also may spur a pickup in residential real estate and help offset a limited availability of lots after unusually harsh weather held back construction at the start of the year.
“With consumer confidence improving, job growth, support from stock markets, credit availability expanding, we’ll start to see that reflected in housing starts numbers and home sales numbers,” Robert Dye, chief economist at Comerica Inc. in Dallas, said before the report. “We’re going to see a little bit more momentum in housing.”
Estimates for starts in the Bloomberg survey ranged from 925,000 to 1.05 million.
Building permits climbed 8 percent to a 1.08 million annualized pace. They were projected to rise to 1.01 million, according to the Bloomberg survey median.
The increase in housing starts was dominated by multifamily construction, such as condominiums and apartment buildings, which increased almost 40 percent to a 423,000 annual rate from 303,000 in March. Work on single-family properties rose 0.8 percent to a 649,000 rate in April from 644,000 the prior month.