US home construction up 3.9% in August after July drop

WASHINGTON. US home construction rebounded a better-than-expected 3.9 per cent in August with the strength coming in apartment construction.

The August increase left home construction at a seasonally adjusted annual rate of 1.62 million units, 17.4 per cent above the pace of a year ago, the Commerce Department reported yesterday. Housing starts had fallen 6.2 per cent in July.

The August strength came in a 21.6 per cent jump in construction of apartment units which offset a 2.8 per cent fall in construction of single-family homes.

Applications for building permits rose 6 per cent to a seasonally adjusted annual rate of 1.73 million units. However, with demand still strong and homes for sale still in short supply, the outlook for housing construction remains solid for the rest of this year.