Housing starts surged in November, increasing almost 23% over the previous month, according to numbers released this week by the U.S. Department of Commerce.
The increase translates into an annual new home start rate of 1.019 million, according to the Commerce Department. It’s the highest level since February 2008.
A strong housing market is a good sign for college students or those considering earning a degree. A strong housing market is a key indicator of an improving economy, often leading to better job opportunities.
Many economists are forecasting an improving national economy as the country moves into 2014.
The housing numbers, while impressive, are still less than half the number of housing starts that happened during the housing boom of the century’s first decade. They are also 25% below the monthly average of the last 50 years.
Joseph LaVorgna, chief U.S. economist at Deutsche Bank, said Wednesday the fact that the housing starts are still below historical levels is a good sign for the New Year. “Because of this, the impressive acceleration in residential investment which has occurred in 2013 should extend through 2014,” LaVorgna said, according to CNN Money.
The Commerce Department report indicated that significant gains in single family home starts were seen primarily in the South and the Midwest. In the Midwest, the gain was almost 42%, while in the South the gain was about 38%.
In the West, the gains were more modest – 8.8%, according to the Commerce Department. In the Northeast, starts actually fell by 29%.
The National Association of Home Builders (NAHB) also released numbers this month indicating that builders’ confidence in the housing market is improving, with the NAHB/Wells Fargo Housing Market Index reaching a 58. That number is four points higher than the previous month.
The survey asks builders to label the housing prospects for the next six months as “good,” “fair” or “poor.” Builders are also asked whether current customer traffic is “high to very high,” “average” or “low to very low.” The NAHB then uses those responses to create a numerical value of the builders’ opinions.
In a press release that accompanied the numbers, NAHB president Rick Judson said the numbers are “ definitely an encouraging sign as we move into 2014…This indicates that an increasing number of builders have a positive view on where the industry is going.”
