Housing starts rose in December, buoyed by a pickup in multifamily construction.

Data from the Census Bureau showed that housing jumped 15.8% in December to an annual rate of 1.49 million, which was higher than economists’ expectations for an annual rate of 1.32 million.

Single-family starts had a modest advance. Construction rose 3.3% to an annualized rate of 1.05 million, the strongest pace since February 2024. Meanwhile, construction for multifamily dwellings grew by nearly 62%.

“Housing starts soared at the top of the 12 months, but this doesn’t mean the country is out of the woods relating to the issues within the residential housing sector,” Christopher Rupkey, chief economist at FWDBONDS, wrote after the discharge.

“There still isn’t enough housing within the country, and the development of residential homes stays historically depressed,” the economist added.

Thus far, recent construction in 2024 was the slowest it has been since 2019, per Bloomberg. Despite the rise in construction, builders are coping with elevated mortgage rates. Freddie Mac said mortgage rates increased to 7.04% this week, hitting the best since May 2024. Rates on a house loan are inclined to follow US Treasury yields, which had been climbing higher following strong employment data.