U.S. housing starts jumped 18.6% in January, as builders ramped up construction of single-family houses to the fastest pace in eight months.
The Commerce Department said Friday that January ground breakings occurred at a seasonally adjusted annual rate of 1.23 million. Home construction rebounded sharply from December, when the annual rate was just 1.04 million.
Most of the new construction came from single-family houses, which were being built at the strongest rate since May 2018. Still, overall housing starts in January were slightly below the 2018 total of 1.24 million as the pace of apartment construction slowed.
The housing market was hurt for much of 2018 by rising mortgage rates, which made it costlier to purchase a home. But average rates have declined since early November and the average 30-year rate was 4.41% this week, providing a possible boost for home buying this year.
Permits for construction, an indicator of future activity, improved 1.4% to a seasonally adjusted rate of 1.35 million. The permits suggest additional apartment construction in the coming months, as that segmented accounted for the gains. Single-family permits fell 2.1% in January to an annual rate of 812,000.