Spring homebuilding season is here — and not a moment too soon.
Privately owned housing starts surged to a seasonally adjusted rate of 1.739 million, up 19.4 percent from February’s revised rate of 1.457 million, according to the Census Bureau’s monthly report. Compared to the same time last year, housing starts were up 37 percent.
March’s report comes after two months of decreased levels of new residential construction.
Single-family starts were up 15.3 percent month-over-month. Building permits and housing completions also saw gains last month.
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The seasonally adjusted rate of permits issued last month was 1.76 million, up 2.7 percent from the revised February rate. Housing completions increased to a seasonally adjusted 1.58 million, up 16.6 percent from February.
The numbers are good news as the housing market’s inventory remains at historically low levels, which — combined with strong demand — has driven up prices. Some economists say that the lack of homes available to purchase is beginning to slow the market.
Mike Fratantoni, chief economist at the Mortgage Bankers Association, is one of them.
“The biggest challenge facing the housing market right now is the lack of supply,” he said in a statement. “This news of more new inventory on the way is very positive.”
Fratantoni said he expects home price growth to slow as new housing units come to market.
Homebuilder sentiment rose this month with builders expecting strong activity from prospective buyers and in single-family sales. The outlook for sales in six months slipped, however.