Single-family Housing Starts rose for the 4th straight month in July, another sign that the battered housing market may be making its comeback.

Housing Starts July 2007-2009

“Housing starts” are new homes on which construction has recently started.

Not surprising, in a related story, homebuilder confidence moved to a 12 month high.

Ironically, an increase in newly-built homes could actually slow a nationwide housing rebound because values are driven by supply and demand. More in-the-pipeline supply means that buyer demand has to stay strong or else prices will eventually fall.

So far this year, though, demand has kept pace.

Over the past 6 months, the combination of low mortgage rates, aggressive home valuations, and federal and state tax credits has kept buyer activity up and home values on the rise.

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