WASHINGTON – Construction of new U.S. homes jumped in December to the highest rate in more than four years, with gains across the country, as well as in single-family homes and buildings, the U.S. Department of Commerce reported Thursday.

In the freshest data signaling a strengthening housing market, starts rose 12.1 percent in December to a seasonally adjusted annual rate of 954,000 — the highest level since June 2008.

“Overall, this report reinforces the current narrative of a positive growth momentum in the housing sector,” said Millan Mulraine, a macro strategist at TD Securities.

Starts rose 24.7 percent in the Midwest, 21.4 percent in the Northeast, 18.7 percent in the West and 3.8 percent in the South.

While starts in December were up 37 percent from a year earlier, rates remain far below a bubble peak of almost 2.3 million in 2006.

Meanwhile, building permits, a sign of future demand, rose 0.3 percent in December to a rate of 903,000 — the highest rate since July 2008. Permits for single-family homes rose 1.8 percent to a rate of 578,000, while permits for structures with at least two units declined 2.1 percent to a rate of 325,000. The lower growth in permits means that starts could slow down in coming months.

For all of 2012, the government estimated that there were 780,000 housing starts, the highest level since 2008 and up 28 percent from 2011.

Mortgage rates hovering near record lows are supporting demand. But analysts remain concerned about overly stringent lending standards.

 

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