Construction of new homes is back. According to new data from the Census, after a dip in the last year, housing starts of private homes jumped 21.7% last month since April. It could be optimism that rates will fall again or a response to a constrained housing supply. New house construction looks poised for a comeback, thought it is still short of what it was during the housing bubble. However, the trend may not continue if inflation remains entrenched and interest rates do not fall back to pre-pandemic levels.
Source: FRED
Allison Schrager is a senior fellow at the Manhattan Institute. Follow her on Twitter here.
Interested in real economic insights? Want to stay ahead of the competition? Sign up for our weekly newsletter here.
Photo by Art Wager/iStock