New Home Construction Makes Slow But Steady Progress

The U.S. home building sector is starting to show improvement that offers a promise of better prices and demand for timberland owners.

The U.S. Commerce Department reports that housing starts in August hit an annualized rate of 1,126,000 units, the fifth consecutive month that starts have been above the one million level and an increase of almost 17 percent over the same period in 2014.

Permits for new home construction, an indicator of future building, were even stronger in August, hitting 1,170,000 units, up almost 4 percent from July and more than 12 percent from the same month in 2014, the Commerce Department reported.

The increase in home building is expected to be reflected in increased demand and higher prices for lumber and sawtimber, both of which have been depressed due to weakness residential construction.

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