WASHINGTON, April 16, 2003 (Hanley-Wood News Service) - Housing starts increased unexpectedly by 8.3 percent in March, buoyed by continued low interest rates, the government reported today. The good news for builders was tempered by a 7 percent drop in March permits, the biggest drop since March 2002.
Starts stood at a seasonally adjusted annual rate of 1.78 million units, up from revised February estimates of 1.644 million units.
Permits fell to a seasonally adjusted annual 1.685 million pace, down from a revised February rate of 1.811 million, the Census Bureau reported.
"In an economy that continues to display overall weakness, housing remains a remarkable source of strength," NAHB President Kent Conine said in a statement. "And we are confident that the industry will experience a very good year in 2003."
March single-family starts climbed to an annual rate of 1.41 million -- up 7.7 percent from February. Multifamily starts rose to an annual rate of 366,000 -- up 10.6 percent.
In a statement, NAHB Chief Economist David Seiders attributed the February decline to harsh winter weather. He characterized the March rebound as a reaction to falling mortgage interest rates that "have been holding the housing affordability equation together."
On a regional basis:
- Starts climbed 9.8 percent to a rate of 157,000 in the Northeast;
- starts rose 25.4 percent to 355,000 units in the Midwest;
- starts rose 9.4 percent to 827,000 units in the South;
- and starts fell 4.5 percent to 441,000 units in the West.
The starts results beat the consensus expectation of analysts, who had forecast a 1.694 million annual rate for March. The permits results were worse than analysts had predicted. The consensus prediction was for a 1.741 million annual rate in March.
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