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November 20, 2011

Housing Starts Dip Slightly, Building Permits Up 11 Percent
The US Commerce Department reported Thursday that housing starts declined by 0.3 percent in October to a seasonally adjusted annual pace of 628,000. Despite the decline, builders broke ground on more new homes than expected and construction permits grew to their highest level since last March, both positive signs for a housing market that has been struggling to gain momentum for five years now.

While below September's pace of 630,000 starts, October's figure was well above the 610,000 pace analysts projected in a recent Bloomberg News survey. Construction permits, which are viewed as an indicator of starts in the coming months, rose 10.9 percent last month, indicating builders are getting ready to ramp up building despite prices that are still being pressured by a massive amount of distressed properties flooding the market.

Also on Thursday, the Department of Labor reported that initial jobless claims fell for a second straight week, indicating the nation's job market, which has weighed heavily on the housing market and the overall economy, may finally be starting to improve. Claims have been under 400,000 for two weeks now, the level which most economists agree claims have to be under in order for the unemployment rate to drop.

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