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July Housing Starts See Surge Thanks to Single-Family Home Building
U.S. housing starts increased in July due to a rise in single-family house construction, despite higher borrowing rates having a greater impact than anticipated on future project plans.
According to official data released on Wednesday, the construction of single-family homes increased by 6.7 percent in July compared to a month earlier to a seasonally adjusted annual pace of 983,000.
The yearly pace of multifamily building decreased 1.7% to 460,000, after season adjustment.
Residential home starts increased overall last month by 3.9 percent to a 1.45 million yearly rate.
The shortage of available existing homes for sale has boosted housing starts. High housing prices and high mortgage rates have deterred many homeowners from selling their homes, which is unfortunate because the majority of people who are selling a home also plan to buy one. Most people are hesitant to switch from a mortgage with a rate of three to four percent to one with the present rate of about seven percent.
Applications to build homes, a leading indicator of future building, increased 0.1 percent to 1.44 million units annually. Wall Street had anticipated a tiny increase in that, but a drop in multifamily permits kept that from happening.
Permits to build single-family homes rose 0.6 percent to an annual rate of 930,000, the highest level in more than a year. Construction permits are seen as a leading sign for upcoming work.
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