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U.S. New Residential Construction Soars In April

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New residential construction in the U.S. showed a substantial increase in the month of April, according to a report released by the Commerce Department on Thursday.

The Commerce Department said housing starts surged up by 5.7 percent to an annual rate of 1.235 million in April after climbing by 1.7 percent to a revised rate of 1.168 million in March.

Economists had expected housing starts to jump by 5.8 percent to a rate of 1.205 million from the 1.139 million originally reported for the previous month.

Single-family and multi-family starts both showed significant increases during the month, spiking by 6.2 percent and 4.7 percent, respectively.

The report also showed housing starts in the Northeast and Midwest skyrocketed in April, more than offsetting notable decreases in the South and West.

The Commerce Department said building permits also rose by 0.6 percent to a rate of 1.296 million in April after edging down by 0.2 percent to a revised rate of 1.288 million in March.

Building permits, an indicator of future housing demand, had been expected to climb by 1.7 percent to a rate of 1.290 million from the 1.269 million originally reported for the previous month.

The increase in building permits came as multi-family permits soared by 8.9 percent, more than offsetting a 4.2 percent slump in single-family permits.

On Wednesday, the National Association of Home Builders released a separate report showing homebuilder confidence has improved by much more than anticipated in the month of May.

The report said the NAHB/Wells Fargo Housing Market Index climbed to 66 in May from 63 in April, while economists had expected the index to inch up to 64.

Following declines in late 2018 due to higher interest rates and concerns over slower growth, the index has reached its highest level since October of 2018.

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