Single-Family Home Builds Up in August

New construction on single-family homes increased 5.5 percent from July to August, the largest month-to-month gain in two years. The increase overcame a dip in multi-family housing starts to register overall growth, though combined permits decreased in August, indicating a potential slowdown in the coming months.

Housing construction rose nationwide in August, fueled by a boost in single-family home starts that powered the market through a slowdown in multi-family unit builds.

Residential construction climbed 2.3 percent, setting an annual rate of 750,000 units, above July's downwardly revised 733,000 annual pace. July was originally reported at a 746,000 pace.

Single-family homes drove the increase, gaining 5.5 percent to a 535,000 rate, the fastest since April 2010. Permits for single-family housing increased 0.2 percent to a 512,000 annual pace, the highest since March 2010.

Construction on multi-family housing units, such as apartments, declined 4.9 percent to an annual rate of 215,000. Permits for multi-unit builds also dropped, falling 3.0 percent to 291,000 units.

Results for combined starts by region were mixed. The Midwest and South posted gains of 20.7 percent and 3.7 percent, respectively, and the Northeast and West posted respective declines of 12.6 percent and 4.3 percent. However, single-family starts rose in every region in August.???(R)???AE'?N????e'?N,A+

Despite an overall decrease in housing starts, a recent survey of the market perceptions of homebuilders showed the most positive results in over six years. The National Association of Home Builders/Wells Fargo index of builder confidence jumped three points in September to 40, the strongest since June 2006.

The survey component gauging sales prospects for the next six months rose eight points to 51, the first time a survey question has received a net positive score (50 or above indicates a positive reading) since early 2006.