Business

US housing starts rise 10.5% in August

Construction workers begin building new home in Springfield, Illinois
Image caption The housing start figures were better than expected

The number of new houses started in the US rose to their highest level in four months in August, Commerce Department figures have shown.

Housing starts rose 10.5% last month - the largest increase since November - to a seasonally-adjusted annual rate of 598,000 units.

A rate of 550,000 had been forecast.

The data suggests the housing market may be starting to stabilise after the end of a tax credit for first-time buyers which expired in April.

Year-on-year, housing starts were up by 2.2%.

'Solid rebound'

New building permits, which signal future home construction, rose 1.8% in August, after dropping 4.1% in July.

"The starts number is a solid rebound from the low of July, but the number is still distorted from the tax credit," said Robert Dye from PNC Financial Services in Pittsburgh.

But he added: "I still see a recovery in housing for the rest of the year."

A survey by the National Association of Home Builders on Monday showed sentiment among home builders remained at an 18-month low in September.

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