Housing starts increase 7.0 in September
Singlefamily starts rise 3.2; multifamily soar 17.1
Building permits fall 4.4; singlefamily increase 1.8

WASHINGTON, Oct 18 Reuters U.S. singlefamily homebuilding rebounded in September, boosted by demand for new construction amid an acute housing shortage, but the highest mortgage rates in nearly 23 years could slow momentum and delay the overall housing market recovery.

That was flagged by other data on Wednesday showing applications for loans to purchase a home plunged last week to levels last seen in 1995. In addition, the jump in housing starts partially recouped the decline in August.

The rebound in homebuilding probably reflected permits approved several months ago before mortgage rates broke above 7. A survey this week showed confidence among singlefamily homebuilders slumped to a ninemonth low in October, with builders reporting lower levels of traffic.

In the very shortterm, singlefamily construction activity is likely to increase with permits rising in every month of 2023 thus far, but at some point mortgage rates are likely to put a lid on new construction activity for home purchase, said Conrad DeQuadros, senior economic advisor at Brean Capital in New York.

Singlefamily housing starts, which account for the bulk of homebuilding, increased 3.2 to a seasonally adjusted annual rate of 963,000 units last month, the Commerce Department said. Data for August was revised to show starts dropping to a rate of 933,000…