WASHINGTON (Reuters) - Groundbreaking on new U.S.
home construction fell more than expected in December to its
lowest in over a year, suggesting the battered housing sector
remains a major roadblock to economic recovery.
U.S. housing starts dropped to an annual rate of 529,000
units, the Commerce Department said on Wednesday, down from
November's 553,000 and well below forecasts around 550,000 in a
Reuters poll. At current levels, starts account for less than a
quarter of their boom-time peaks.
At the same time, building permits soared, a hint of
optimism about future demand. Permits jumped 16.7 percent to
635,000, far above a median forecast of 560,000 and the biggest
jump since June 2008. Changes to state building codes may have
boosted permits in California, Pennsylvania and New York, the
report said. For example, permits surged 80.6 percent in the
Housing was at the epicenter of the worst financial crisis
in generations, which began when banks started to take a hit
from rising defaults in the mortgage sector in the summer of
(Reporting by Pedro Nicolaci da Costa; Editing by Andrea
© 2014 Thomson/Reuters. All rights reserved.