Housing Starts Tumble 4%;Building Permits Also Drop
A WALL STREET JOURNAL ONLINE NEWS ROUNDUP
WASHINGTON -- The number of housing projects commenced by builders declined for the second straight month in February as bad weather in some parts of the country forced construction delays. Housing starts fell by 4.0% to a seasonally adjusted 1.855 million annual rate, the Commerce Department said Tuesday. Building permits, an indicator of future building activity, fell by 1.5% to a 1.903 million annual rate. The government raised its earlier estimate of home-building activity, which didn't drop as fast as initially predicted in January. Starts for that month fell by 6.3% to a seasonally adjusted annual rate of 1.932 million units. They were previously reported as falling 7.9% to a 1.903 million annual rate. November housing numbers were unrevised. The report was weaker than analysts had expected. A Dow Jones Newswires-CNBC poll of 20 economists predicted housing starts would actually rise by 1.0% to a 1.920 million annual rate in January. "With mortgage rates retreating over the past several weeks, a rebound in new home sales and single-family housing starts is likely once more normal weather returns," wrote Steven Wood, chief economist at Insight Economics, in a note to clients. But he cautions that lagging housing activity could be a drag on GDP in the first half of the year. February's drop carried starts to their lowest level since August. It was also nearly 10.0% below December's record rate of 2.051 million units, the highest level in nearly 20 years
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