US Housing Construction Reaches 19-month High

Posted December 20th, 2011 at 10:55 am (UTC-5)
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The U.S. government says that housing construction advanced in November to a 19-month high, but the number of homes being built was still sharply lower than what economists consider a healthy pace.

The Commerce Department said Tuesday that housing starts increased more than 9 percent from October to an annual rate of 685,000 units. That pace is well above the record-low total of 554,000 in 2009 during the worst portion of the U.S. recession, but significantly lower than what housing experts consider to a favorable annual rate of more than one million new units.

The housing industry in the United States has been one of the weakest links in the country's sluggish economy. Millions of homeowners, often workers who have lost their jobs, have been forced out of their houses in foreclosures by banks when they were unable to make their monthly loan payments.

New housing in the U.S. accounts for about a fifth of houses sold, with previously owned homes accounting for the bulk of sales. But the new housing has a disproportionate effect on the economy, with construction of each home creating the equivalent of about three jobs for a year and generating $90,000 in taxes.