(CN) — Housing starts slumped in July, led by a dramatic scaling back of construction of apartments, the Commerce Department said Wednesday.
According to the government, housing starts fell 4.8 percent in July to a seasonally adjusted annual rate of 1.16 million — a three-month low.
Groundbreakings for multi-family buildings such as apartments slumped 17.1 percent, while single-family house construction slipped 0.5 percent.
Housing starts dropped in the Northeast, Midwest and West but rose modestly in the South. Building permits, an indicator of future construction, decreased 4.1 percent to 1.22 million.
Home construction has increased 2.4 percent year-to-date, but the gains have done little to offset the dwindling number of homes listed for sale.
The shortage of properties for sale has pushed prices up at a faster pace than income growth, making home ownership less affordable for many would-be buyers.