US House Construction Improving
Home builders have probably started on more houses last April, after the US economic outlook increased for the first time in a long time. This is a clear sign that the dust is already settling, and that the recession is already abating. This insight was given by economists last week.
House construction has risen by around 2 percent to an annual rate of 520,000 units. This is a good sign amid the slump in the housing industry that has been happening in the past four years. Among the other components are rising customer confidence and increasing stock prices. The economy is seen to be experiencing growth in the next coming months.
According to Zach Pandl, a Nomura Securities International Inc. economist, house construction had already reached their toughest and lowest time last year, and is now on its way to recovery. He further adds that with this slow growth, the recession is seen to be coming to an end.
The housing report from Commerce strengthens this outlook and sees future house construction starts. Other data about the housing industry have been showing good signs of stability and continuous, although slow, growth.
Home builders are even becoming more optimistic about the construction industry, although they continue to experience some negative effects of the recession. For one, the largest home builder in the country, D.R. Horton Inc., has in fact experienced loss for the last quarter. According to Donald Horton, chairman of the big construction company, the condition in the construction market are still difficult and quite challenging for them.
In addition, financing is still difficult for home buyers. This is according to a recent report by the Federal Reserve. A lot of lending companies are becoming stricter in releasing and approving loans, giving home buyers a very hard time before they can start on their houses.
The jump in the economic outlook for house construction was the first and the biggest in almost a year. This is further strengthened by data showing that even manufacturing companies are slowly easing their way out of the economic recession. Lastly, the Labor Department is expected to report that jobless claims that resulted from the shutdown of some Chrysler LLC plants has caused applications in the week before.
