Home construction off to strong start

By Chris Isidore

 

 

Builders filed the the most building permits since early 2008 in January.

 

Home construction got off to a strong start in 2013, as builders filed for the greatest number of permits in more than four years in January

 

Permits are a sign of builders' confidence in the market. It's also less affected by weather than housing starts. Last month, builders filed for permits at an annual rate of 925,000, up about 2% from December and up 35% from a year earlier. It was the best month for permits since June 2008.

Meanwhile, the pace of housing starts slowed to an annual rate of 890,000 in January, down 9% from December, when there was a spike related to repairs from Super storm Sandy. But even the lower pace of starts was up 24% from a year ago.

The housing market has been helped by a number of factors in recent months, including increased sales of both new homes and previously-owned houses, a drop in foreclosures, and near record low mortgage rates. A drop in the nation's unemployment rate is also helping.

 

The rebound in home sales, prices and construction are all positives for the broader economy. Economists believe this is the year that housing could help lead the way on overall economic growth.