NEW YORK (CNN/Money) - New home construction in the United States accelerated in September to the second-fastest pace of the year, the government said Friday.
The Commerce Department said the pace of housing starts rose 3.4 percent to a seasonally adjusted annual rate of 1.88 million units, after falling a revised 3.4 percent to 1.83 million units in August. Economists, on average, expected housing starts to rise to a 1.87 million-unit pace, according to Briefing.com.
The report had little impact on the stock market, which fell Friday. Treasury bonds opened flat Friday before gaining ground.
The housing market has been a pillar of strength in an otherwise unsteady economy in recent years. Super-low mortgage rates have encouraged people to buy homes, driving up home prices and making homeowners feel wealthier.
Homeowners also have been able to refinance their mortgages at lower rates, cutting their monthly expenses and turning some of their home equity into cash.
After bottoming out in mid-June, mortgage rates have been rising, leading many analysts to believe the best days of the housing market likely are over and the refinancing boom has ended.
With rates still very low by historical standards, demand for housing has not exactly disappeared, though it has slowed.
In the Commerce Department report, building permits -- a forward-looking indicator of housing demand -- fell 2.2 percent to an annualized pace of 1.86 million units.
The Northeast saw a 15.1 percent gain in the pace of sales, while the Midwest saw an 8.1 percent gain. Sales in the South fell 1.3 percent, while sales in the West rose 4.2 percent.
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