Evidence of an improving housing market continues to emerge.
The number of applications for U.S. home mortgages is on the rise and data from the U.S. Census Bureau and U.S. Department of Housing and Urban Development indicates U.S. single-family home starts increased impressively in December 2014.
Business Insider noted the greater number of housing construction projects taking place may indicate good news for the U.S. economy. The housing market has improved sluggishly over the past few years, and the recent gains are particularly well-received. An influx in housing starts may signal a heightened demand for housing, which can drive the market up.
Construction is growing at a notable rate. In December 2014, single-family home starts occurred at a greater rate than they had in 6½ years. Additionally, groundbreaking in all of 2014 increased to 1.01 million units – an increase of 8.8% since 2013, according to HUD. That growth is the highest rate seen since 2007.
Privately owned housing starts jumped up 5.3% in December 2014 from December 2013, and single-family home starts were up 7.2% from November 2014’s estimates.
December 2014 also saw an increased number of privately owned housing completions, which ticked up 19.6% from December 2013. The number of completions also outpaced November 2014’s estimated number of completions by 6.3%.
Homebuilders have a positive outlook on housing starts in 2015. The National Association of Home Builders, a trade group, is optimistic going into to the new year. As the U.S. moves into a stronger economy, seeing more job growth and low interest rates, the NAHB anticipates a promising 2015.
The association expects a 6.7% increase for housing starts from 2014 to 2015, or 993,000 units. NAHB predicts single-family home starts to increase 26%, which still remains below the level of starts seen prior to the housing crisis in 2008.
In addition to the anticipated boost in construction, NAHB also foresees some growth in the remodeling market this year. The organization forecasts remodeling projects of owner-occupied, single-family homes may increase 3% from the prior year in 2015 and an additional 1.5% in 2016.
“Remodelers are responding to calls from homeowners on steadier financial footing than recent years,” said Robert Criner, NAHB Remodelers chairman. “From major kitchen remodels and bath facelifts to room additions, the members of NAHB Remodelers look forward to providing professional remodeling services in 2015.”