New residential construction showed a substantial increase in the month of November, according to a report released by the Commerce Department on Wednesday, with housing starts jumping to their highest level in over five years.
The report said housing starts surged up 22.7 percent to a seasonally adjusted annual rate of 1.091 million in November from a rate of 889,000 in October. Economists had expected housing starts to come in at an annual rate of 955,000.
With the sharp monthly increase, housing starts rose to their highest level since reaching an annual rate of 1.103 million in February of 2008.
October housing starts were up 1.8 percent from the September rate of 873,000, which reflected a 1.1 percent decrease from the revised August rate of 883,000.
The Commerce Department delayed the release of the data for September and October, as the recent government shutdown affected the data collection schedule.
The jump in housing starts in November reflected notable increases in both single-family and multi-family starts.
The report said single-family starts surged up by 20.8 percent to an annual rate of 727,000, while multi-family starts soared 26.8 percent to a rate of 364,000.
Additionally, significant growth was seen in the Midwest and the South, where housing starts jumped 41.7 percent and 38.5 percent, respectively.
Housing starts in the West also showed a notable 8.8 percent increase, while starts in the Northeast tumbled by 29.4 percent.
Meanwhile, the report also showed that building permits fell by 3.1 percent to a seasonally adjusted annual rate of 1.007 million in November from the revised October rate of 1.039 million.
Building permits, an indicator of future housing demand, had been expected to show a steeper decrease to a rate of 990,000.
The pullback came after building permits reached their highest level since June of 2008 in the previous month.
While single-family permits rose 2.1 percent to an annual rate of 634,000, the increase was offset by a 10.8 percent drop in multi-family permits, which hit a rate of 373,000.
The Commerce Department noted that housing starts were up by 29.6 percent compared to the same month a year ago, while building permits were up 7.9 percent year-over-year.
Peter Boockvar, managing director at the Lindsey Group, said, "Bottom line, this data helps to confirm the optimism seen in yesterday's NAHB builder survey and continues the normalization process where single family starts are still just barely above the trough in the 1991 recession and still 60% below the peak in January."
"Who the buyers are of the new single family homes is still somewhat of a mystery as mortgage applications to buy a home are at the lowest of the year," he added. "I think investors have entered the new home market with plans to rent them out."
On Tuesday, the National Association of Home Builders released a report showing that homebuilder confidence improved by much more than anticipated in the month of December.
The report showed that the NAHB/Wells Fargo Housing Market Index climbed to 58 in December from 54 in November, while economists had been expecting the index to edge up to 55.
With the bigger than expected increase, the index reached its highest level since a matching reading in August, which represented a nearly eight-year high.
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May 01, 2026 15:54 ET Central banks dominated the economics news flow this week with almost all major ones announcing their latest policy decisions and many boosted expectations for a rate hike in June. In other news, several countries released the preliminary data for first quarter economic growth. In the U.S., comments by Fed Chair Jerome Powell were also in focus as his term ends this month.