Housing Starts Strong; Up 2.8% in February

Construction of new homes in February rose at the fastest pace in more than three years and the housing market is expected to remain strong in the months ahead, the Commerce Department said Wednesday.

Increased construction likely means more business for flatbed trucking companies that haul building materials. Also, in the case of home construction, dry van freight can see an increase in demand for the delivery of household appliances and furniture.

Annualized, the February pace of housing starts would be 1.769 million, up 2.8% from a revised 1.721 million-unit pace the month before. That was the most homes started since December 1998, and was led by a 7.4% increase in single-family home starts.

This report caught many analysts by surprise, since housing starts in January had been boosted by unusually warm weather in much of the country, Reuters reported.

In addition, building permits, which are an indicator of future construction, increased 1.8% to 1.752 million units. It rose 4.1% in January, Commerce said.

Economists told Reuters the report was another encouraging sign about the strength of the economic recovery.

Commerce said starts rose 14% in the West, 0.9% in the South and 0.8% in the Midwest. Starts declined 9.3% in the Northeast.

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