Housing starts recovered from their October swoon in November with an 8.9% gain to a seasonally adjusted annual rate of 574,000, the Commerce Department reported Wednesday morning. Though up, the pace still lagged the same month last year by -12.4%.
Single-family starts also were up, albeit at a smaller rate, with a 2.1% jump from October, a gain of 5.5% from November, 2008. Much of the overall gain was attributable to a 62% surge in apartment construction from October to a rate of 83,000.
Permits in November were at up 6% to a seasonally adjusted annual rate of 584,000, still 7.3 percent% below November 2008. Single-family permits were up 5.3% to a rate of 473,000, 12.1% ahead of the same month last year.Permits also were partly driven by a big gain in multifamily construction involving buildings with 2 to 4 units, which was up 56.3% from October.Larger apartment projects (5 units or more), however, were flat with the prior month.
Completions also were up in November, posting an 8.7% rise from October, but completions still lagged the pace last year by -25.3%. Single-family completions in November were flat with a revised October at a rate of 524,000.
Regionally, November starts were up 16.4% in the Northeast, but single family was 2.1% behind last year; up 3.0% in the Midwest, with single family posting a drop of 6.2%; up 12.3% in the South, with single-family posting a gain of 4.4%; and up 1.9% in the West, with a 5.4% increase in single-family homes. Year-over-year, starts were up 14.3% overall and 12.2% for single family in the Northeast; down 2.8% and 13.6%, respectively, in the Midwest; down 15.2% but up 12.9% in the South; and down 23.4% and up 2.1% in the West.
Permits were up 4.7% overall and 6.4% for single-family in the Northast; up 1.9% and 2.7%, respectively, in the Midwest; up 10.7% and 6.0% in the South; and up 2.7% and 5.3% in the West. Year-over-year, permits were -6.9% overall but up 6.4% for single-family; up 4.1% and 1.4% in the Midwest; down 1.6% but up 15.3% in the South; and down 26.0% but up 16.3% in the West.
The news set off a rally in builder stocks, with most of the group up between 2% and 5% in midday trading. Beazer (NYSE:BZH), Hovnanian (NYSE:HOV) and Orleans (AMEX:OHB) were up more than 10% each, likely on short-interest covering amid the rally.