Among all the indicators that can be used to gauge the health of the housing market, few are as significant as new home construction. After all, home builders wouldn’t be building homes if they didn’t think there were interested home buyers. When new home construction is rising, there’s probably a good reason.
Because of this, the January numbers recently released by the U.S. Census Bureau and the Department of Housing and Urban Development are encouraging. They show a 25.1 percent month-over-month increase in the number of new homes that began construction in January and a 30.2 percent increase in the number of completed new homes.
That’s a significant improvement, and a pretty good indication that home builders expect a busy spring and summer. However, though the construction numbers are impressive, the number of permits to build homes were only up 1.4 percent. That could be a sign that the building boom will be short lived, but only time will tell.