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The numbers: Construction of new homes rose 14.8% in November, as builders scaled up new projects.
The pace of construction increased as builders saw strong home-buying demand, amid a shortage of homes for sale.
So-called housing starts rose to 1.56 million annual pace from 1.36 million in November, the government said Tuesday. That’s how many houses would be built over an entire year if construction took place at the same rate in every month as it did in November.
The data exceeded expectations on Wall Street, where the expected rate was 1.36 million. The numbers are seasonally adjusted.
Both single-family construction and multi-family were up in November.
In a more recent survey of builders in December, builders were more optimistic about home-buying demand, yet continued to slash prices in November to keep shoppers interested.
A drop in mortgage rates in mid-December may provide a further boost to starts and new home sales in the coming months.
Building permits, a sign of future construction, fell 2.5% to a 1.46 million rate.
Market reaction: U.S. stocks
DJIA
SPX
were up early Tuesday. The yield on the 10-year Treasury note
BX:TMUBMUSD10Y
was below 4%.
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