Housing Starts Hit Four-Year High; Bernanke Heads Back To Capitol Hill
There's more evidence that the housing sector is on the mend and may be the sector of the economy that's got the most going for it these days.
According to the Census Bureau and Department of Housing and Urban Development there was a 6.9 percent increase in "housing starts" last month. At an annual rate of 760,000, ground-breaking for construction of single-family homes, apartments and condominiums the pace hit a four-year high, The Associated Press says.
As Eyder reported last Wednesday, The Wall Street Journalhas already concluded that "the U.S. housing bust is over" and that housing "is unlikely to drag the U.S. economy down further."
Federal Reserve Chairman Ben Bernanke will get another chance to share his thoughts about how the economy is doing this morning at 10 a.m. ET when he testifies before the House Committee on Financial Services. Tuesday, when he appeared before the Senate Banking, Housing & Urban Affairs Committee, he painted a rather glum picture.
Bernanke did note, though, that:
"We have seen modest signs of improvement in housing. In part because of historically low mortgage rates, both new and existing home sales have been gradually trending upward since last summer, and some measures of house prices have turned up in recent months. Construction has increased, especially in the multifamily sector."
The Fed chairman added, however, that:
"A number of factors continue to impede progress in the housing market. On the demand side, many would-be buyers are deterred by worries about their own finances or about the economy more generally. Other prospective homebuyers cannot obtain mortgages due to tight lending standards, impaired creditworthiness, or because their current mortgages are underwater--that is, they owe more than their homes are worth. On the supply side, the large number of vacant homes, boosted by the ongoing inflow of foreclosed properties, continues to divert demand from new construction."