The number of housing units under construction grew for the third month in a row, as housing continues to drive the construction industry.
The last time single-family homes were built at this pace was 13 years ago, just before the housing bubble burst.
Housing starts last month increased 1.2 percent, seasonally adjusted, with 19,000 more units getting under way than in October, according to the Census Bureau’s monthly report on residential construction. In October housing starts grew by nearly 5 percent month-over-month, while in September they grew by 2 percent compared to August.
Housing starts in November were up 12.8 percent from the same period last year, when just 1.37 million units were under construction.
Residential construction accounted for 44 percent of total construction spending in October, the most recent period for which data is available. But homebuilders, which have been reporting unprecedented levels of optimism for the housing market, are beginning to rein in expectations. This month an index tracking homebuilder sentiment dropped for the first time since April.
But Joel Kan, head of industry forecasting at the Mortgage Bankers Association, noted that permits for single-family home construction rose to 2007 levels, which he said could indicate that the increase in homebuilding may continue into early 2021.
He also noted that housing starts of single-family homes had reached the highest level since 2007 for the second month in a row. The record was initially broken in October.
Building permits were up 6.2 percent to 1.63 million units, seasonally adjusted, compared to October. Permitting was up 8.5 percent year-over-year.
Despite increases in housing starts and permits, supply remains tight. Housing completions last month dropped 12 percent to 1.16 million units, seasonally adjusted, from 1.3 million units finished in October.