US home construction in weak March start: Commerce Dept.
U.S. homebuilders opened the spring buying season in March at a slower pace than last year, a warning that recent hiring gains have failed to translate into a stronger real estate market.
Construction firms broke ground at a seasonally adjusted annual rate of 926,000 homes last month, a 2.5 percent decline from the pace in March 2014, the Commerce Department said Thursday.
Steady job growth, low mortgage rates and cheaper gasoline have given consumers more flexibility. But the improved economy has yet to significantly boost sales and construction, even as econo- mists say that the gains should soon flow into housing.
“There would ideally be more momentum than what we’re seeing, but housing activity should continue to improve in the months ahead,” said Jennifer Lee, a senior economist at BMO Capital Markets.
Still, the warmer weather helped after a brutal winter. March housing starts rebounded 2 percent from this past February’s rate of 908,000 homes. Builders broke ground on more homes in the Northeast and Midwest, two areas hammered by snow storms and freezing temperatures in previous months. But the pace of construc- tion slipped last month South and West.
March traditionally marks the start of the spring home buying season, when more people flood into the market and sales increase. But the relatively modest pace of new construction and few homes being listed for sale have kept inventories tight, limiting the potential for sales to rise. Homebuilders have increasingly focused on two key markets: wealthier buyers and apartment complexes, because increasingly expensive houses have priced many out of the market and led them to rent.
Approved building permits fell from February, sliding 2.9 percent
the in March to an annual rate of 1.04 million. The entire decline came from the volatile multi- family category that includes apartment construction.
More Americans Sought Jobless
Benefits Last Week
The number of Americans seeking unemployment aid rose for the second straight week yet remained at a low level that is consistent with more hiring.
Applications increased 12,000 last week to a seasonally adjusted 294,000, the Labor Department said Thursday. Despite the increase, other data suggests that the number of laid-off workers applying for benefits is low.
The four-week average, a less volatile measure, ticked up 250 to 282,750, just barely above the previous week’s level, which was the lowest in nearly 15 years.
With fewer Americans seeking aid, the number of people collecting benefits fell to 2.27 million, the lowest in more than 14 years. The benefit rolls have dropped because some unemployed have found jobs, while many others have used up all the benefits available.
The data provided some hope to economists that last month’s sluggish hiring was a temporary slip.