A report released by the Commerce Department on Tuesday unexpectedly showed a sharp increase by new residential construction in the U.S. in the month of July.
The Commerce Department said housing starts shot up by 5.2 percent to an annual rate of 1.428 million in July after spiking by 5.9 percent to an upwardly revised rate of 1.358 million in June.
Multi-family starts led the way higher once again, soaring by 9.9 percent to an annual rate of 489,000 in July after skyrocketing by 33.6 percent to an annual rate of 445,000 in June.
The report said single-family starts also jumped by 2.8 percent to an annual rate of 939,000 in July after plunging by 3.8 percent to an annual rate of 913,000 in June.
Meanwhile, the Commerce Department said building permits tumbled by 2.8 percent to an annual rate of 1.354 million in July after edging down by 0.1 percent to a downwardly revised rate of 1.393 million in June.
Building permits, an indicator of future housing demand, were expected to fall by 0.5 percent to an annual rate of 1.390 million from the 1.397 million originally reported for the previous month.
With the much bigger than expected decrease, building permits fell to their lowest level since hitting an annual rate of 1.334 million in June 2020.
The steep drop by building permits came as multi-family permits plunged by 8.2 percent to an annual rate of 484,000, more than offsetting a 0.5 percent increase in single-family permits to an annual rate of 870,000.