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Finally! Strongest Housing Starts Since 2008

— Photo Courtesy of http://www.yc.edu

Outlook for residential real estate is on the uptrend and will push the economy in the right direction  as data indicates that  U.S. home starts in June was one of the fastest pace in almost 4 years according to economists.

Seventy-nine economist surveyed by Bloomberg News  provided the data that indicates housing starts moved up 5.2 percent last month to 745,000 estimated annual which is the  strongest since 2008   according to the median estimates, and building permits.

“The long-awaited housing market recovery is definitely under way as demand is improving,” said Stuart Hoffman, chief economist at PNC Financial Services Group in Pittsburgh. “Continued growth in the number of households, pent-up demand, very low prices and mortgage rates that have resulted in record- high affordability” are underpinning demand, he said.

Confidence among U.S. homebuilders climbed in July by the most since September 2002.
Index of sentiment increased by 6 points to 35 this month as sales and buyer traffic improved according to a report from the  National Association of Home Builders/Wells Fargo.

“As we start to move prices up, it starts to draw people off the sidelines who are potential homebuyers, people that are at the age they should be buying a house, but they’ve been concerned about a further decline in prices,” Daniel Fulton, chairman and chief executive officer of forest-products company Weyerhaeuser Co. (WY), said at a June 13 conference. “So we’re starting to see some increase in activity.”

The housing supply is moving as record low mortgage rates and lower property values attract buyers reducing the inventory.  This will cause the home builders to boost construction which will create jobs and stimulate the economy.

The Standard & Poor’s Supercomposite Homebuilding Index, which includes D.R. Horton Inc. and PulteGroup Inc., has climbed 52 percent this year, outpacing an 8.4 percent gain in the broader S&P 500 Index.

“Evidence from the field suggests that the ‘for sale’ housing market has, in fact, bottomed and that we have commenced a slow and steady recovery process,” Stuart Miller, chief executive officer at Lennar Corp., the third-largest U.S. homebuilder by revenue, said in a June 27 statement.


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