The rate of construction for new homes fell sharply in January.
According to the U.S. Census Bureau and the Department of Housing and Urban Development, privately-owned housing starts were down 8.5 percent from December's revised estimate -- to a seasonally adjusted annual rate of 890,000. Still, the January rate is 23.6 percent above the year-ago rate of 720,000.
Single-family housing starts in January were at a rate of 613,000 -- 0.8 percent above the revised December figure of 608,000. The January rate for units in buildings with five units or more plunged 26.1 percent from December -- to 260,000.
David Crowe, chief economist at the National Association of Home Builders, tells ConsumerAffairs, that the huge decline in starts for the rental sector was due to a leveling out from the huge surge of starts in December.
Applications for building permits, an indicator of what developers have in mind for the future, were higher.
Permits for privately-owned housing units totaled a seasonally-adjusted annual rate of 925,000 -- up 1.8 percent from revised December rate of 909,000 and 35.2 percent above the January 2012 estimate of 684,000.
Single-family permits were up 1.9 percent from December at rate of 584,000, while authorizations for units in buildings with five units or more were up 1.0 percent -- to a rate of 311,000.
Crowe says overall, the January report shows “modest improvement” in housing and that he expects it to continue throughout 2013. He says those builders who have “been waiting for several years are finally deciding to go forward.”