New U.S. housing starts fell by more than expected in the month of December, according to figures released Thursday by the Commerce Department.
New housing starts, which had been buoyed in November by strong activity in multi-family dwellings, fell to a seasonally adjusted annual rate of 657,000 in December, 4.1 percent below the November level.
Economists had predicted some fall off in the market, but most had expected housing starts to remain somewhat higher, at a 678,000 annual rate.
However, single family housing starts remained strong, rising 4.4 percent to a rate of 470,000 in December. By contrast, starts for buildings with five or more units tumbled 27.8 percent.
Jennifer Lee, senior economist with BMO Capital Markets, said, "Sure U.S. housing starts fell more than expected in December, but some retracement was expected after November's sharp 9.1% surge."
New building permits for December, a leading indicator for future housing starts, held relatively level in December, edging down by just 0.1 percent to an annual rate of 679,000 - largely in line with the 680,000 predicted by most economists.
Housing starts declined by a relatively modest 3 percent in the South, the nation's largest housing market, with single family construction up 3.4 percent.
Meanwhile, starts in the Midwest soared 54.8 percent, with new construction of single-family dwellings up 31.9 percent.
The increase, however, was offset by a 17.6 percent drop in housing starts in the West - all in apartment buildings as single family housing starts showed no change.
In addition, new housing in the Northeast, a relatively small housing market, fell 41.2 percent, with single family starts down 17.9 percent.
However, in a sign that the housing market may be recovering, both housing starts and building permits posted gains from December 2010 levels, with housing starts up 24.9 percent and permits up 7.8 percent.
On Wednesday, a report from the National Association of Home Builders showed that homebuilder confidence has jumped to a four-year high in January.
The report showed that the NAHB/Wells Fargo Housing Market Index surged up to 25 in January from 21 in December, while economists had expected the index to remain unchanged. With the unexpected increase, the index rose to its highest level since coming in at 28 in June of 2007.
New housing starts, which had been buoyed in November by strong activity in multi-family dwellings, fell to a seasonally adjusted annual rate of 657,000 in December, 4.1 percent below the November level.
Economists had predicted some fall off in the market, but most had expected housing starts to remain somewhat higher, at a 678,000 annual rate.
However, single family housing starts remained strong, rising 4.4 percent to a rate of 470,000 in December. By contrast, starts for buildings with five or more units tumbled 27.8 percent.
Jennifer Lee, senior economist with BMO Capital Markets, said, "Sure U.S. housing starts fell more than expected in December, but some retracement was expected after November's sharp 9.1% surge."
New building permits for December, a leading indicator for future housing starts, held relatively level in December, edging down by just 0.1 percent to an annual rate of 679,000 - largely in line with the 680,000 predicted by most economists.
Housing starts declined by a relatively modest 3 percent in the South, the nation's largest housing market, with single family construction up 3.4 percent.
Meanwhile, starts in the Midwest soared 54.8 percent, with new construction of single-family dwellings up 31.9 percent.
The increase, however, was offset by a 17.6 percent drop in housing starts in the West - all in apartment buildings as single family housing starts showed no change.
In addition, new housing in the Northeast, a relatively small housing market, fell 41.2 percent, with single family starts down 17.9 percent.
However, in a sign that the housing market may be recovering, both housing starts and building permits posted gains from December 2010 levels, with housing starts up 24.9 percent and permits up 7.8 percent.
On Wednesday, a report from the National Association of Home Builders showed that homebuilder confidence has jumped to a four-year high in January.
The report showed that the NAHB/Wells Fargo Housing Market Index surged up to 25 in January from 21 in December, while economists had expected the index to remain unchanged. With the unexpected increase, the index rose to its highest level since coming in at 28 in June of 2007.
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