Wells Fargo Reports: Housing Construction Continued to Strengthen in November

Housing starts rose 3.3 percent in November to a 1.297 million-unit pace after a downwardly revised 1.256 million-unit pace in October. Strength in the West and South pushed single-family starts to a decade high.

Residential Building Up in the South and West

•  Revisions pushed some of the building activity first reported in October into November. Housing starts were at a 1.297 million- unit pace in November and single-family building reached a new cycle-high of 930,000 units.
•  Residential starts were up in the South and West, but declined in the Midwest and Northeast. Multifamily was behind the slowdown in the Northeast, which has seen completions surge.

Residential Investment to Still Boost Q4 GDP

• Revisions post-storm pushed the bulk of building activity into November. The building trend is clearly on the rise, particularly compared with earlier this year. Solid readings for both October and November bode well for Q4 GDP growth.
• Construction is likely to strengthen further in coming months. The latest NAHB/Wells Fargo survey of homebuilders posted solid gains in December, reaching its highest level since 1999.