U.S. Housing Starts Rose in September

U.S. housing starts rose in September, the government said, as the housing sector continued to display a surprising resilience in a rapidly deteriorating economy.

But other indicators showed how the slowing U.S. economy is taking a toll on the housing sector. Building permits issued, an indicator of builder confidence, were at their lowest level since 1997. And although overall mortgage applications climbed rapidly, the number of requests for new home loans, as opposed to refinancings, was down.

Groundbreaking for new homes hit a seasonally adjusted rate of 1.574 million units last month, a 1.7% increase over the August rate of 1.548 million units, the Commerce Department said.

Housing starts rose 4.4% from September a year ago. The rate of home starts exceeded the estimates of analysts polled by Reuters, which had forecast a 1.512-million-unit pace. The rate of housing starts showed regional inequalities in September. Starts fell 16.6% in the Midwest and 11% in the Northeast. However, the rate of groundbreaking rose 12.5% in the West and 7.6% in the South.

The rate of building permits being issued fell 3% in September. Permits were at their lowest level since December 1997, when they were at 1.456 million.