U.S. housing starts, building permits accelerate – CNBC
A house under construction is seen in Culver City, a neighborhood of Los Angeles on November 21, 2020.
Chris Delmas | AFP | Getty Images
U.S. homebuilding and permits surged in December as historically low mortgage rates supported the housing market, but momentum could slow amid surging lumber prices and a shortage of labor.
Housing starts jumped 5.8% to a seasonally adjusted annual rate of 1.669 million units last month, the Commerce Department said on Thursday. Economists polled by Reuters had forecast starts would rise to a rate of 1.560 million units in December. Homebuilding increased 5.2% on a year-on-year basis. Starts totaled 1.380 million in 2020, up 7.0% from 2019.
Permits for future homebuilding accelerated 4.5% to a rate of 1.709 million units in December. Permits, which typically lead starts by one to two months, totaled 1.452 million last year, a 4.8% increase from 2019.
Single-family homebuilding, the largest share of the housing market, soared 12.0% to a seasonally adjusted annual rate of 1.338 million units. Single-family starts have increased for eight straight months.
Though the housing market and manufacturing remain the economy’s star performers, the relentless COVID-19 pandemic is hurting the availability of labor at construction sites as sick workers stay at home.
A survey on Wednesday showed a dip in confidence among single-family homebuilders in January. Builders complained about “supply-side constraints related to lumber and other material costs, a lack of affordable lots and labor shortages that delay delivery times and