U.S. Housing Starts, Building Permits Rebound More Than Expected In August

(RTTNews) - A report released by the Commerce Department on Wednesday showed a substantial rebound by new residential construction in the U.S. in the month of August.

The Commerce Department said housing starts spiked by 9.6 percent to an annual rate of 1.356 million in August after plunging by 3.9 percent to a revised rate of 1.237 million in July.

Economists had expected housing starts to surge by 5.8 percent to an annual rate of 1.310 million from the 1.238 million originally reported for the previous month.

The bigger than expected rebound by housing starts came amid a sharp increase by single-family starts, which skyrocketed by 15.8 percent to an annual rate of 992,000.

On the other hand, the Commerce Department said multi-family starts tumbled by 4.2 percent to an annual rate of 364,000.

The report also said building permits shot up by 4.9 percent to an annual rate of 1.475 million in August after tumbling by 3.3 percent to a revised rate of 1.406 million in July.

Building permits, an indicator of future housing demand, were expected to increase by 1.0 percent to an annual rate of 1.410 million from the 1.396 million originally reported for the previous month.

Single-family permits jumped by 2.8 percent to an annual rate of 967,000, while multi-family permits soared by 9.3 percent to an annual rate of 508,000.

A separate report released by the National Association of Home Builders on Tuesday showed homebuilder confidence in the U.S. improved by slightly more than expected in the month of September.

The report said the NAHB/Wells Fargo Housing Market Index rose to 41 in September from 39 in August. Economists had expected the index to inch up to 40.

The increase breaks a string of four consecutive monthly declines, with the index rebounding from its lowest level since hitting 37 last December.