Housing Starts Soar 10.5% in August

Housing starts increased more than expected in August to their highest level in four months and permits for future home construction rose, government data showed on Tuesday, suggesting the embattled housing market was starting to stabilize following the end of a tax credit.

The Commerce Department said housing starts rose 10.5 percent, the largest increase since November, to a seasonally adjusted annual rate of 598,000 units. July's residential construction was revised down to show a 0.4 percent gain, which was previously reported as a 1.7 percent increase.

Analysts polled by Reuters had expected housing starts to rise to a 550,000-unit rate. Compared to August last year, housing starts were up 2.2 percent.

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