Home construction increased in August as applications for building permits also grew, the US Commerce Department said Tuesday. Construction of new homes and apartments rose 10.5 percent in August from a month earlier to a seasonally adjusted annual rate of 598,000-the highest level since April, the Commerce Department said. Boosting the figures was a 32 percent monthly increase in the condominium and apartment market, a small portion of the market. Single-family homes, which represent about 80 percent of the market, grew more than four percent. Housing starts are up 25 percent from their bottom in April 2009, but are still down 74 percent from their peak in January 2006. Building permit applications, a sign of future activity, grew by nearly two percent to an annual rate of 569,000. Builders are struggling with weak demand for new homes caused by high unemployment and an influx of foreclosed homes on the market. They had benefited in the spring from federal tax credits, but those expired in April. Construction activity rose 34 percent in the West and was up 22 percent in the Midwest and 7 percent in the South. However, construction fell by 24 percent in the Northeast. On Monday, the National Association of Home Builders said its monthly index of builders' sentiment was unchanged in September at 13. The index has now been at the lowest level since March 2009 for two straight months.
