Builders began work on more houses in February and permits for future construction climbed to the highest level in almost five years, pointing to a sustained rebound that will help power the U.S. expansion.
Housing starts climbed by 0.8 percent last month to a 917,000 annualized pace, the Commerce Department reported today in Washington. Permits rose 4.6 percent to a 946,000 rate, the most since June 2008.
Advances in residential construction will probably give an even bigger boost to growth this year than in 2012, when it contributed for the first time in seven years. The gains are rippling through the economy as improving property values help restore consumer confidence and benefit builders such as Ryland Group and home-improvement retailers, offsetting some of the damage from government cutbacks.
“We’re optimistic about the housing recovery,” said Anika Khan, a senior economist at Wells Fargo Securities in Charlotte, N.C., a subsidiary of the largest U.S. mortgage lender and the second-best housing starts forecaster over the past two years, according to data compiled by Bloomberg. “We’ll continue to see construction pick up. Housing continues to be a bright spot for the economy.”