By Xavier Fontdegloria

Construction of new homes in the U.S. increased in December for the fourth consecutive month, reaching the highest level since September 2006, signaling the housing market ended the year on a strong footing, data from the Commerce Department showed Thursday. Here are the main takeaways from the report:

--Housing starts, a measure of U.S. homebuilding, increased by 5.8% in December compared with November, to a seasonally adjusted annual rate of 1.669 million. This is above The Wall Street Journal poll of economists, who expected starts to increase by 0.8%, to an annual pace of 1.56 million.

--The current level of starts is above February's pre-pandemic annual rate of 1.57 million and 5.2% higher if compared with the same month a year earlier.

--In November, housing starts amounted to an upwardly revised 1.578 million from an earlier estimate of 1.547 million.

--Monthly housing starts data are volatile and are often revised. December figures came with a margin of error of 11 percentage points.

--Residential permits, which can be a bellwether for future home construction, increased by 4.5% in December, at a seasonally adjusted annual rate of 1.709 million. The figure beats economists' forecasts of a 1.8% fall to an annual pace of 1.61 million.

--U.S. housing starts report for December compares with January's fall of the indicator compiled by the National Association of Homebuilders, which showed a slight decline of confidence in the single-family housing market.

Write to Xavier Fontdegloria at xavier.fontdegloria@wsj.com

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(END) Dow Jones Newswires

January 21, 2021 08:59 ET (13:59 GMT)

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