U.S. residential housing market increased at double digits in 2012

Builders started work on homes in December at the fastest pace since the summer of 2008 and finished 2012 as the best year for residential construction since the housing crisis began, the U.S. Department of Commerce reported.

All prime housing indicators such as permits, starts and completions were up by double digits in 2012, potentially anticipating a private-housing recovery in the U.S. market.

BUILDING PERMITS

An estimated 813,400 housing units were issued building permits in 2012, an increase of 30.3% above the 2011 figure of 624,100.

Building permits for privately owned housing units in December were at a seasonally adjusted annual rate of 903,000 or 28.8% above the December 2011 estimate of 701,000.

Single-family authorizations in December were at a rate of 578,000. Authorizations of units in buildings with five units or more were at annual rate of 301,000 in December.

HOUSING STARTS

Privately owned housing starts in December were at a seasonally adjusted annual rate of 954,000 or 36.9% above the December 2011 rate of 697,000.

Single-family housing starts in December were at an annual rate of 616,000. The December rate for units in buildings with five units or more was 330,000.

An estimated 780,000 housing units were started in 2012. This is 28.1% above the 2011 figure of 608,800.

The Commerce Department said builders broke ground on houses and apartments at a seasonally adjusted annual rate of 954,000. That is nearly double the recession low of April 2009.

Steady growth in home construction is the latest sign of a housing recovery that is gaining strength. Moreover, it is the most since 2008—shortly after the housing market collapsed in late 2006 and 2007.

HOUSING COMPLETIONS

An estimated 651,400 housing units were completed in 2012 or 11.4% above the 584,900 in 2011.

Privately owned housing completions in December were at a seasonally adjusted annual rate of 686,000, 13.2% above the December 2011 rate of 606,000.

Single-family housing completions in December were at a rate of 535,000. The December rate for units in buildings with five units or more was 144,000.

Single-family home starts have been improving for the same reasons that the existing home market is doing better. Job growth is fueling more housing demand as more people can afford to form households. Improving sales and fewer foreclosures have thinned once-bloated supplies of homes for sale.

That too is driving demand for construction. The National Association of Home Builders (NAHB) predicted single-family-home starts will rise 35% this year over last.

While builder confidence in January held at its highest level in more than six years, uncertainties stemming from last month’s fiscal cliff negotiations “contributed to the pause in builder confidence,” said Barry Rutenberg, immediate past NAHB chairman.

From: Caribbean Business