Housing Starts Down 2.6% in June

The decline was largely due to a drop in construction of single-family homes.
Author:
Publish date:

Builders slowed their pace of new home construction for the second straight month in June, to the lowest rate in more than two years.

Housing starts

, a measure of the number of new homes that began construction, fell 2.6% in June to a seasonally adjusted 1.554 million pace from 1.596 million in May, the slowest rate since May 1998, the

Commerce Department

reported Thursday.

The decline in homebuilding was largely due to a drop in construction of single-family homes, which fell 3% to 1.214 million. Multi-family homes dipped 0.5% to 340,000 million.

The data add to a variety of other numbers that have shown slower activity in U.S. real estate markets in recent months, as higher mortgage rates and slowing business activity

dent consumers' confidence. Other measures of the housing market, such as

sales of new homes, have also been on the decline.

The average rate on a 30-year fixed mortgage stood at 8.28% in June, down from 8.52% in May but sharply higher than 7.55% in June 1999, according to mortgage giant

Freddie Mac

.

Housing permits, a forecaster of future homebuilding activity, were unchanged in June at 1.511 million, suggesting that the housing market may continue to slow over the next several months.

Regionally, housing starts were down 5.4% in the Northeast, and fell 19.8% in the Midwest. In the western U.S., starts fell 1.6%. But in the South, starts rose 5.6%.