Housing starts soared in November, rising 22.7% from October’s revised estimate and 29.6% from last year, government data shows.
The quick surge prompted market analysts to speculate that the report gives the Fed even more momentum to begin tapering its monthly asset purchases.
Privately-owned housing starts reached an annual rate of 1.091 million in November, compared to 889,000 in October and 842,000 last year, the Commerce Department data reveals.
Single-family housing starts alone hit a rate of 727,000 in November – a 20.8% climb from October.
Meanwhile, the November start rate for buildings with five or more units hit 354,000.
Building permits – a forward looking indicator for the construction industry – fell on the other hand. Housing units authorized by building permits edged down to 1.07M in November, a 3.1% drop from October. Still, that figure is 7.9% above year ago levels.
Single-family permits alone rose 2.1%, reaching a November rate of 634,000 units.
Buildings with five or more units reached a permit authorization rate of 346,000 in November.
"Housing regained some momentum over the last three months," analysts with Econoday noted. "Between recently strong retail sales and housing starts numbers, fourth quarter growth may be moderately strong. Today's data add to odds that the Fed may taper somewhat with this afternoon's policy statement."