US housing construction jumps 16.9% in December

WASHINGTON (AP) — Construction of new homes surged in December to the highest level in 13 years, capping a year in which falling mortgage rates and a strong labor market helped lift the prospects of the housing industry.

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The Commerce Department reported Friday that builders started construction on 1.61 million homes at a seasonally adjusted annual rate in December, up 16.9% from the November pace of home building.

Housing construction has been rising since July, helped by falling mortgage rates and increased demand as the unemployment rate approached a half-century low. For the year, builders started work on a total of 1.37 million homes, the best showing since 2007.

The December building rate was the strongest number since December 2006 during the last housing boom.

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Applications for building permits, considered a good sign of future activity, fell 3.9% to an annual rate of 1.42 million, but remained well above the pace in July.

Construction of single-family homes rose 11.2% to an annual rate of 1.06 million homes while apartment construction fell 9.6%.