Housing starts tumble 9% in September
New-home construction cooled off unexpectedly in September as apartment builders took a step back, according to new figures released Wednesday by the Commerce Department.
Housing starts tumbled 9% to 1.047 million in September, down from August's revised rate of 1.15 million starts. It's also 11.9% lower from a year earlier.
Economists track housing starts closely as a gauge for the housing market's health.
The decline was concentrated principally in apartment complexes, which are often volatile. Housing starts on complexes with five or more units fell 38.9% from a month earlier.
Single-unit housing starts rose 8.1% from a month earlier, a positive sign for the market..
And multifamily housing permits advanced 16.8%, indicating that the drop in September was likely a blip.
"Given this, we see the sharp fall in starts in September as unexpected and anomalous," says Barclays economist Blerina Uruci. "We expect to see a rebound in housing starts as the building permits begin to come online."
Building permits on privately owned housing units broadly rose 6.3% to 1.225 million, up from August's rate of 1.152 million. Permits were up 8.5% year-over-year. Applications for housing permits is an indicator for future housing activity.
Housing starts were particularly weak in the Northeast and Midwest, where they were down 36% and 14.1%, respectively.
Contributing: Paul Davidson
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