WASHINGTON - U.S. home building has hit a 12-year-high, says U.S. Commerce, as permits for new homes surged 3.8 percent in October.

 

Starts for single-family houses were up 2 percent from September, mostly due to increased construction in the West and South. October marked the fifth straight month of single-family increases. Starts for multi-family housing spiked 8.6 percent.

 

Since October 2018, housing starts have risen more than 8.5 percent. Building permits have surged 5 percent to a rate of 1.46 million units, the highest achieved since May 2007. Single-family starts are driving the market, with a 3.2 percent increase since August 2007. Starts rose in the West, South, and Midwest - only declining in the Northeast.

 

Cautious optimism may be needed, however. In a survey earlier this week, builders remain confident in the industry, but note a lack of labor, an abundance of regulatory constraints, and lot shortages. Mortgage rates have also backed up the past two months.

 

Softwood lumber prices remain flat since last week, reports Madison's Lumber Reporter, but are up considerably from last year.

 

Existing home sales are also forecast to increase.