U.S. Housing Starts Fell 7.9% in January to 1.903 Mln [View All]

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U.S. Housing Starts Fell 7.9% in January to 1.903 Mln
(Update1) Feb. 18 (Bloomberg) --

U.S. housing starts fell to a 1.903 million-unit annual rate last month, a government report showed, as frigid temperatures and storms restrained building in some parts of the country. <snip>

The annual pace of housing starts last month still exceeds last year's total of 1.848 million....Economists had expected starts to slip to 2 million homes at an annual pace from the previously reported 2.088 million rate in December, according to the median forecast in a Bloomberg News survey.

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Single-Family Starts Starts of single-family homes fell 8 percent in January to a 1.537 million-unit rate after a 1.670 million rate a month earlier. Starts of townhouses, apartments and other multifamily homes fell 7.8 percent to a 366,000 annual rate in January.

Building permits, an indicator of future construction, fell 2.8 percent to 1.899 million units at an annual rate, after rising to 1.953 million the previous month.

The average 30-year fixed mortgage rate in January was 5.74 percent, down from 5.88 percent a month earlier, according to Freddie Mac, the No. 2 buyer of U.S mortgages. In June, the 30- year rate reached 5.21 percent, the lowest in at least 45 years, Freddie Mac said. Mortgage Rates "With mortgage rates stable in recent months, there is no reason to expect a further near-term drop in home sales," Ian Shepherdson, chief U.S. economist at High Frequency Economics in Valhalla, New York, said. "A serious downturn in housing activity will have to wait until there is a meaningful increase in mortgage rates." <snip>

The yield on the 10-year note, which averaged about 3.99 percent last year, is forecast to rise to 4.40 percent by the second quarter, based on the median estimate of economists surveyed by Bloomberg News from Jan. 30 to Feb. 6.