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US housing starts surge past expectations in January
US housing starts surged past expectations last month, according to data released by the Commerce Department.
Housing starts were up 9.7% to a seasonally-adjusted rate of 1.326m from an upwardly-revised 1.209m in December. On the year, starts were up 7.3%.
Single-family housing starts in January were up 3.7% to 877,000 from December's revised figure of 846,000.
Meanwhile, building permits jumped 7.4% to 1.396m from December and from January last year, in line with expectations. Housing completions rose 1.9% from December's revised figure to an annual rate of 1.166m, and were up 7.7% on the year.
Ian Shepherdson, chief economist at Pantheon Macroeconomics, said the figures are "hugely distory by multi-family noise".
"Most of the action was in the volatile multi-family sector, where starts and permits soared by 23.7% and 26.5% respectively. The much larger but less erratic single-family numbers were much less exciting, with starts up 3.7% and permits down 1.7%. The multi-family numbers likely will mean-revert in February so the headline data will look much weaker.
"The underlying story here is that housing constructionis grinding slowly higher, and likely will continue to do so through mid-year, at least. Higher mortgage rates are likely to become a problem later in the year."