Bloomberg News
WASHINGTON - Housing construction starts in the United States fell unexpectedly in November to their lowest pace in seven months as single-family home construction declined, government figures showed Friday.
Housing starts dropped 2.3% last month, to a seasonally adjusted annual rate of 1.6 million units, the Commerce Department said. Starts in October were unchanged at a 1.637 million-unit pace, previously reported as 1.628 million. Analysts had expected starts to rise in November to a pace of 1.649 million.
Still, starts remain on track to beat last year's level, which set an 11-year high. "The housing industry is still in pretty good shape," said Scott Brown, an economist at Raymond James & Associates in St. Petersburg, Fla.
Permits for housing construction rose 1.3% in November, to an annual rate of 1.614 million units. Permits for single-family units rose for the second month in a row.
Single-family starts fell 3.6% in November, to a 1.292 million-unit rate, while starts of multifamily homes rose 3.7%, to a pace of 308,000 units.
The November pace for total starts was the slowest since a 1.577 million rate in April. Still, starts are on pace to total 1.673 million units this year, up from last year's 1.617 million.
As interest rates have risen this year, demand for housing has slowed. Sales of new and existing homes are expected to drop to 5.65 million units next year after reaching a record 6.11 million in 1999, Fannie Mae, the largest U.S. mortgage financier, predicted last week.
The 30-year fixed-mortgage rate averaged 7.74% in November, higher than the average rate of 6.69% in the same month last year, according to Bloomberg analytics.
