US home construction slows

Source: Financial Times

Construction of new homes in the US fell unexpectedly in March to the lowest in five months, but approvals for building permits –a proxy for future construction –increased to their highest level in more than three years.

Housing starts fell 5.8 per cent last month to an annual rate of 654,000 units, the lowest level since October 2011, from the downwardly revised February estimate of 694,000, according to the commerce department. Analysts had expected 700,000 groundbreakings in March. New home construction was up 10.3 per cent year on year.

Construction slowed slightly in February after hitting the fastest pace in three years in January. Seasonal factors often affect groundbreakings, and analysts said the rise in new home construction early this year has been, in part, a response to an unusually warm winter.

Construction of single-family houses dipped 0.2 per cent to a 462,000 rate in March while work on multi-family homes, which include town houses and apartment buildings, dropped 17 per cent to an annual rate of 192,000.

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