Good news for real estate and construction companies in the United States, as latest reports signal a significant growth in Housing start and construction market. The Great Recession in 2008 slowed many things down mostly hitting housing space, because people did not have enough to buy or rent a place.
With time and increased economic strength of the people, 2015 as a financial year has been very positive. Economists have analyzed the number of new constructions being started in June and it has grown up to 26%. Not just this The National Association of Home Builders is happy to announce that this year has been the best year for housing market in this decade.
The demand for new houses is increasing because of the level of population and incomes are rising again. Many youngsters are getting out of their bachelor pads and starting their lives after the Great Recession. With stable jobs and careers the demands have surged up to 7.4% for housing starts. Both the housing starts and new permits have risen up to their 8-year highs.
In June 2014, the housing starts were reported at 927,000, whereas this year it has been to 1,174 million, and that is significantly higher than the previous year. In May 2015, housing starts for single families were 691,000 while it has been reported at 685,000 in June 2015. Similarly, permissions for June is also jumps around 30 percent year-over-year, which is highest since July 2007’s figure – 1,361 million.
According to economists it is way more than the expected increase and it is time to recover the losses incurred during recessions. The building permits are also on the rise and while digging deeper economists unravelled that demand for multifamily houses have increased up to 29% while single homes are slipping. It is indeed a great June for U.S. Housing.
American homebuilders are excited about the new projects as many buyers are free from credit problems and ready to spend big on living spaces. Starting households this year is a great idea if you are thinking of getting a new apartment.
Friday’s numbers show a sign of a great rise in multi-family housing, but builders are still hopeful about the ‘newly constructed, single-family home’ market. Builder confidence in this sector hit a level of 60 in July, according to the National Association of Home Builders/Wells Fargo Housing Market Index.
“This month’s reading is in line with recent data showing stronger sales in both the new and existing home markets as well as continued job growth,” said David Crowe, NAHB’s chief economist. “However, builders still face a number of challenges, including shortages of lots and labor.”
The US housing building permits, annual rates are depicted below:
Do you think the impact of the great recession is really subdued by now or this boom is just in the housing sector alone? Let us know in the comments below.
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