Thursday, March 21, 2002

New-home pace rose last month

Feb. starts at 3-year record

By Jeannine Aversa
The Associated Press

        WASHINGTON — Housing construction, bolstered by low interest rates and good weather, climbed in February to its highest level in more than three years.

        Home builders broke ground in February on 1.77 million housing units, at a seasonally adjusted annual rate, which was 2.8 percent more than in January, the Commerce Department reported Wednesday.

        “The Energizer Bunny of the economy, the housing market, keeps on going and going and going,” economist Joel Naroff of Naroff Economic Advisors said.

        February's larger-than-expected increase pushed housing construction to its highest level since December 1998 and followed a strong 7.4 percent advance in January, even bigger than the government previously reported.

        Locally, housing starts barely budged last month.

        There were 442 permits for single-family homes in Hamilton, Butler, Warren and Clermont counties in February, up from 335 in January and down from 443 the same month last year, according to the Home Builders Association of Greater Cincinnati.

        All of the strength last month came from single-family home construction, which rose 7.4 percent to a rate of 1.46 million in February, the highest level in more than 23 years.

        The number of apartments, condos and other multifamily housing fell by 12 percent to a rate of 264,000. Economists think that the drop reflected in part weaker demand for rental housing as low mortgage rates and solid appreciation in home values have made buying a home attractive.

        “Builders are still seeing home buyers really excited about the investment aspects of homeownership and about good financing conditions,” said David Seiders of the National Association of Home Builders.

        A survey by the association showed that home builders are more optimistic about sales prospects for March as well as for sales in the next six months.

        Enquirer reporter Jeff McKinney contributed.


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