Adding another sign that the housing market is slowing down, new home construction in the U.S. fell last month to its lowest level since May 2017, despite declining mortgage rates.
The news could signal that homebuilders are having a difficult time constructing cost efficient homes amid rising supply and labor costs.
In March, overall construction starts dropped 0.3 percent to a 1.139 million annualized rate, according to Bloomberg. This is down from a rate of 1.142 million in February.
In particular, single-family starts fell 0.4 percent to 781,000 in March, the slowest pace since September 2016.
Permits, which economists use as an predictor of future building, fell 1.7 percent to a 1.27 million rate.
There have been a number of indicators that show that the post-recession housing boom is coming to and end. Home-price growth has slowed for 10 consecutive months in April and inventory has been rising. This comes about despite mortgage rates falling to its lowest level in about a year with the 30-year fixed rate at just over 4 percent, which makes owning a home more affordable for buyers. [Bloomberg] — Keith Larsen