The Census Bureau said Tuesday that builder permits and new housing starts fell sharply last month from a year ago, but the results were near economists' expectations.
Building permits, an indicator of future supply in the housing sector, came in at an annual rate of 1.31 million units in August, down 5.9% from July and 24.5% from a year earlier.
Housing starts totaled an annual rate of 1.3 million units in August, a 2.6% drop from July and a 19.1% plunge from a year earlier.
Single-family starts fell 7.1% from July to August, which appears to be a sign that homebuilders are cutting back on new construction. That may help ease the large amount of housing inventory across the U.S.
Economists expected 1.35 million each of new permits and starts. The levels of both were the lowest in more than 12 years.
Builder stocks were rising in pre-market trading, continuing their rally from the
50-basis-point rate cut Tuesday.
rose 3.1% to $15 in pre-market trading. The stock surged 28% Tuesday amid short covering after the Fed's larger-than-expected rate cut.
-- two other builder stocks with large short interests -- rose about 1.5% each in pre-market trading.