Homebuilder exchange traded funds were set to end the week on a high note after a report Friday that U.S. housing starts rose nearly 6% in July.

The iShares US Home Construction (NYSEArca: ITB) and SPDR S&P Homebuilders (NYSEArca: XHB) were both up more than 1% after their notable turnarounds on Thursday. Homebuilder industry confidence is at its highest levels in nearly eight years, according to a report released Thursday. [Homebuilder ETFs Climb]

The housing ETFs saw a jump in trading volume during Thursday’s rally. In fact, ITB saw its highest volume ever with over 22 million shares trading hands.

Still, rising mortgage rates remain a concern for the housing market and homebuilder stocks.

“I think we are looking at a situation that some air is coming out of the housing recovery given the higher mortgage rates,” said Michael Hanson, senior economist with Bank of America Merrill Lynch, in a Reuters report. “At this point, affordability has not changed that much on a historical basis. Housing affordability remains high, but fundamentals are less favorable for new buyers than they were a couple of months ago.”

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