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American housing starts dive to two-year minimum
In March, American homebuilding went down to an almost two-year minimum, suppressed by ongoing weakness in the single-family housing segment, dropping a hint that the housing market kept struggling notwithstanding decreasing mortgage rates.
Housing starts headed south by 0.3% to a seasonally updated annual rate of 1.139 million units in March, which appears to be the lowest result since May 2017, as the Commerce Department informed on Friday.
February’s data was updated downwards to demonstrate homebuilding decreasing to a tempo of 1.142 million units versus the previously posted 1.162 million-unit rate.
Building permits inched down by 1.7% to a rate of about 1.269 million units in March that happens to be the lowest outcome for five months. Eventually, building permits have slumped for three straight months. As for permits for single-family housing, they decreased to a more than 1-1/2 year minimum last month, which is an adverse omen for starts in the nearer future.
Financial analysts interviewed by Reuters had predicted that in March housing starts would tack on to a tempo of 1.230 million units.
The everlasting weakness in homebuilding reflects land as well as labor shortages, not to mention costly building materials.
Tuesday’s poll revealed that despite builders posted firm demand for new homes, they kept highlighting affordability worries stemming from an everlasting shortage of construction employees as well as buildable lots.
As a matter of fact, the 30-year fixed mortgage rate has gone down from November’s maximum of nearly 4.94% to 4.12%, as follows from data provided by mortgage finance agency Freddie Mac.
Furthermore, single-family homebuilding went down by 0.4% hitting 785,000 units the previous month that turns out to be the lowest reading since September 2016.
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