Housing starts rebound in July
Aug. 26, 2014 - After a disappointing June report, U.S. housing starts rebounded with a 15.7% increase in July. The June dip was caused by a fall in single-family construction in the U.S. South and was eliminated as single-family construction rose 8.3% with increases in three of the four U.S. regions, according to the National Association of Home Builders (NAHB).
The rebound mirrored rising home builder confidence. The August NAHB/Wells Fargo Housing Index rose two more points to 55, approaching the 2014 high of 56 from January. Expectations for the next six months increased by two points to 65.
According to the NAHB, a key question going forward is the degree to which the mix of buyers may change. The share of first-time home buyers remains weak and has resulted in a rising trend in new single-family home size. If more first-time buyers enter the market in the future, it will hold back the median new single-family home size.
Consumer debt positions continue to improve, says the NAHB, which should be a net positive for housing demand.
Meanwhile, the count of unfilled construction sector jobs increased in June to 127,000, the fourth highest tally since the end of the recession. The number of job openings has grown significantly since 2011 as the housing industry has recovered. Builders will find it challenging to meet demands if they're unable to find enough workers.
For more information, go to http://www.nahb.org.