The new home construction market in the United States is showing promising signs of recovery, with the number of starts on single-family homes jumping 13.5 percent higher in August from the month before.
This is the highest rate of annual growth since October 2016 and provides a much-needed boost to the housing market, which has been a weak spot in the otherwise robust American economy.
The rising number of starts could soon mean more new homes for sale in a sector that has been plagued by a lack of supply for many years. This could start to put downward pressure on prices, with sellers having to compete for buyers rather than the other way around.
The jump in construction could also lead to more jobs being created in the sector, leading to more money being spend on labor, materials, and services in the local economy.
Investment in new home construction is typically seen as a sign of economic confidence, and can be an important part of triggering more home buying demand. This time it may not be enough, however, as the credit market is still tight and many potential homebuyers are stuck with high debt levels. Only time will tell if the uptick in housing starts is enough to revive the ailing market.
