April's surprise surge in home construction and building permits renewed hope for a spring rebound, after weeks of disappointing economic news.
Amherst Pierpont chief economist Stephen Stanley said the report was the first real piece of economic data that supports his view for a vigorous rebound in the second quarter. Groundbreakings jumped 20.2 percent to a more than seven-year high, and a 10.1 percent increase in permits to 1.14 million was the highest since June 2008.
"February was weak. We were expecting a rebound in March," he said. "We got a rebound but it wasn't as strong as expected. Then everyone got all nervous, and we wait an extra month and voila! Everything shows up in April. I think you have to be a little careful about writing off a second-quarter rebound yet."