Housing Starts Surge 3.7% in June

U.S. housing starts rose 3.7% in June to the highest level since January, as low mortgage rates stoked demand, the Commerce Department reported Thursday.

Builders started work on 1.803 million homes at an annual rate, up from the 1.738 million-unit pace in May. Economists had forecast starts to rise 1%, Bloomberg reported.

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.

In another report released Thursday, the number of Americans filing new jobless claims fell 29,000 last week to 412,000, the Labor Department reported Thursday.

Commerce also said building permits, an indicator of future construction, rose 0.8% to 1.817 million units at an annual rate.

The number of homes authorized for construction and not yet started rose to 188,400, the most since March 1990.

By region, starts rose 9.9% in the Northeast, 8% in the West, and 2.3% in the South. Construction fell 0.8% in the Midwest.

Meanwhile, a Labor Dept. spokesman said the decrease in jobless claims reflected difficulties in adjusting for seasonal shutdowns in the automobile, textile and apparel industries, Reuters reported.

Initial claims historically have risen sharply in July, partly because automobile plants shut down for retooling. Without seasonal adjustments, claims rose by 66,182 last week.

Still, the four-week average, which smoothes out weekly fluctuations, declined by 3,500 to 424,000.

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