The housing sector continues to be a beacon of light for the U.S. economy boosted in part by low borrowing costs. The U.S. Census Bureau reports that Housing Starts rose 1.2% from October to an annual rate of 1,547,000 units versus the 1,530,000 expected. Multi-family construction rose 8% while the single-family sector saw a meager 0.4% gain. Building Permits, a sign of future construction, jumped 6.2% with permits for multi-family units up a whopping 22.8%.
Home borrowing costs hit fresh record lows this week and continue to buoy the housing market. Freddie Mac reports that the 30-year fixed-rate mortgage was at 2.67% this week with 0.7 in points and fees. A year ago at this time, the rate averaged 3.73%. Sam Khater, Freddie Mac’s Chief Economist said, “Mortgage rates are at record lows and pushing many prospective homebuyers off the sidelines and into the market. Homebuyer sentiment is sanguine and purchase demand shows no real signs of waning at all heading into next year.”
Americans filing for first-time unemployment benefits rose in the latest week to 885,000 from 853,000,000 and well below the March and April highs. Continuing claims, or those receiving benefits for at least two weeks straight, fell to 5,508,000 from 5,781,0000. The sector was decimated by the pandemic-induced shutdowns in March, April and May and now the fears are increasing that additional lockdowns will take place in certain parts of a country.