WASHINGTON, Wed Dec 19, 2012 — U.S. permits for future home construction set their fastest pace in nearly 4½ years in November, pointing to underlying strength in the housing market, even as starts dropped after three straight months of strong gains.
The Commerce Department said on Wednesday building permits increased 3.6 percent to a seasonally adjusted annual rate of 899,000 units, the highest since July 2008.
Economists polled by Reuters had expected permits, which lead starts by at least a month to rise to an 875,000-unit pace last month from 868,000 units in October.
Groundbreaking fell 3.0 percent to an 861,000-unit pace, worse than economists’ expectations for a pullback to 873,000 units. October’s starts were revised down to show an 888,000-unit pace instead of the previously reported 894,000 units.
The step back in homebuilding in November followed three straight months of solid gains, and reflected a 5.2 percent drop in the Northeast, which was slammed by Superstorm Sandy in late October. Starts also tumbled 19.2 percent in the West.
The housing market has regained some footing after a historic collapse that pushed the economy into its worst recession since the Great Depression.