Posted on Monday, January 12th, 2015 at 3:01 am
The number of new home constructions in the U.S. has marginally fallen in November. This only reflects the weakness in single-family home construction. According to the Commerce Department’s report, builders began construction in November at an annual rate that is seasonally adjusted at 1.03 million apartments and homes. This showed a 1.6% decline from October’s 1.7% gain in construction activity.
The weakness observed on November has resulted due to a 5.4% fall in single-family home construction, that has offset the 6.7% rise in the apartment sector which is more volatile in nature. There was also a notable fall of 5.2% in building permit applications as it settled to a seasonally adjusted annual rate of 1.04 million. The housing sector is expected to regain momentum in the year 2015, as the analysts believe that increase in employment will trigger home sales.
It is the opinion of economists that the November decline in the construction sector is not a very good news but is partially caused due to the extreme snowy weather in most parts of the nation. November 2014 was the coldest in 14 years.
One of the senior economists at BMO Capital Markets, Jennifer Lee, observed that the construction activity in October had been revised by 3.6% and the construction activity in September, October and November had crossed the 1-million mark. She remarked that easier lending standards, low mortgage rates and strong job growth will act as supporting pillars for the housing sector.
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