October’s increase in starts ended three straight months of declines. Home building has struggled this year, hamstrung by shortages of land and labor as well as expensive lumber.

Investment in home building has contracted for two consecutive quarters. That has contributed to a worsening housing shortage, which has held back home sales.

A survey on Thursday showed confidence among home builders in November at the second-highest level since July 2005 amid optimism about current sales conditions and buyer traffic. Builders, however, continued to complain about the lack of buildable lots, land and pricey materials.

Single-family home building, which accounts for the largest share of the housing market, increased 5.3 percent to a rate of 877,000 units in October, the highest level in eight months.

Single-family starts fell 22.4 percent in the Northeast and slipped 7.7 percent in the West. They rose 7.8 percent in the Midwest. Groundbreaking on single-family housing projects has slowed since racing to near a 9-1/2-year high in February. Last month, starts for the volatile multi-family housing segment surged 36.8 percent to a rate of 413,000 units.

Building permits increased 5.9 percent to a rate of 1.297 million units in October, the highest level since January. Single-family home permits rose 1.9 percent, while permits for the construction of multi-family homes jumped 13.9 percent.

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