U.S. Home Construction Continues Upswing
January 17, 2013 | 11:15 am CST
Home Builder Confidence Hits 6-Year High in December

U.S. Home Construction Continues UpswingWASHINGTON - Residential housing starts were up 28.1% percent in 2012, making it one of the best years since the housing crisis began, according to figures released Jan. 17 by the U.S. Census Bureau and the Department of Housing and Urban Development.

According to the departments, an estimated 780,000 housing units were started in 2012. Building permits issued for housing units during the year were at approximately 813,400, up 30.3% over 2011 figures, with December figures for 2012 up 28.8% compared to the same period a year earlier. The Census Bureau and HUD also report an estimated 651,400 housing units were completed in 2012, an 11.4% rise over 2011 figures.

Despite continuing concerns over mortgage rates and conditions and government spending cuts, the 2012 figures have builder confidence in the housing market holding steady, with January remaining at a level of 47 on the National Association of Home Builders/Wells Fargo Housing Market Index.

"Conditions in the housing market look much better now than at the beginning of 2012 and an increasing number of housing markets are showing signs of recovery, which should bode well for future home sales later this year," Barry Rutenberg, NAHB chairman and a home builder from Gainesville, FL, said in a statement. "However, uncertainties stemming from last month's fiscal cliff negotiations contributed to the pause in builder confidence and continuing discussions among policymakers related to spending cuts and the future of the mortgage interest deduction could put a damper on housing demand in the coming months."

"Builders' sentiment remains very close to the index's tipping point of 50, where an equal number of builders view conditions as good and poor, and fundamentals indicate continued momentum in housing this year," NAHB Chief Economist David Crowe added.

According to the latest NAHB/First American Improving Markets Index (HMI) , the number of metro areas showing signs of improved housing is continuing to grow, rising for a fifth consecutive month to 242 markets. The HMI shows January markets are up from the 201 markets listed in December. The IMI identifies improving metro areas based on housing permits, employment and house prices for six consecutive months.

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