According to the Emerging Trends in Real Estate 2016 survey, US residential construction starts totaled 1.2 million for June and July 2015 — the most activity in the last 8 years. Single-family housing, rather than more apartment development, spurred this growth. Historical normalcy appears to have returned, as the inventory of finished new homes for sale now approximates 5 ½ months, and price increases have begun to reflect a shortage of supply.
While interest rates will slowly trend upward, the Fed will take great care not to stall the recovery. These conditions set the stage for further gains in 2016, given the existing scarcity of ready-to-build housing lots. The multiplier effect will result in the addition of other jobs, as well as increased economic activity in the retail sector.