Published on : Nov 27, 2013
October 2013 saw the highest ever building permits being awarded in over five years. According to analysts, this signals the strengthening of the U.S. residential real estate market in 2014.
The applications for new real estate permits in the residential sector grew by 6.2% reaching an annualized rate of 1.03 million. These figures were released by the Commerce Department in Washington. The department’s figures also reflected a seven-year high in property values in the third quarter of 2013. Interestingly, these growth figures beat the Bloomberg forecast that had emerged from a survey conducted among economists.
According to these figures, multifamily units will likely be responsible for the advancing state of the homebuilding sector in the months ahead, with construction companies looking beyond higher borrowing rates and launching ambitious projects.
However, yet another report indicated that the sentiment among consumers continues to remain fragile even as the holiday-shopping season beckons. This could likely be a sign of the impact that the political gridlock in Washington has had on the overall economy.
According to senior economists, the housing data suggests that this sector will contribute to economic growth. Though interest rates have been backed up, economists suggest that this hasn’t been large enough for a visible impact on the housing sector.
The 16-day partial shutdown of the U.S. government had an impact on consumer confidence that slid down to a seven-month low with Americans maintaining a pessimistic outlook of the labor market and wages.