July housing starts climbed 5.9% on a rise in multifamily projects, the Commerce Department said Friday.
Starts rose to an annual rate of 896,000 units in July, from a revised 846,000 pace in June that was higher than originally reported.
Building permits, an indicator of future construction activity, rose 2.7% to a 943,000 annual pace.
Economists had forecast an annual rate of 900,000 housing starts in July, Bloomberg News reported.
Single-family-unit construction fell 2.2% to an annual rate of 591,000 units, the fewest since November, while multifamily-unit construction climbed 26% to an annual rate of 305,000.
Three of four regions had an increase in starts in July, led by a 40.2% rise in the Northeast. Housing starts declined 7% in the South, Commerce said.