Home Starts Hit by |Southern Doldrums

     (CN) – U.S. home construction slumped in August, led by a sharp decline of activity in the Southeast.
     Overall, the Census Department said Tuesday, the pace of housing starts nationwide fell to their lowest level in three months.
     But the news from Washington wasn’t entirely bad. While the South submarined the national numbers, with starts plummeting 14.8 percent, building activity actually increased in the Northeast, Midwest and West.
     Ground breakings dropped 5.8 percent to a seasonally adjusted annual rate of 1.4 million from 1.21 million in July, the department said.
     Residential construction has picked up this year as steady job gains and low mortgage rates propel more Americans to seek out homes.
     Starts have increased 6.1 percent so far in 2016, with single-family houses leading the way. The rebound has been held in check by rising land and labor costs, leading many economists to project a sustained period of construction because demand is so strong.
     In the short term, builders have relatively few properties in the pipeline. Authorized permits fell 0.4 percent in August to an annual rate of 1.14 million — a level slightly lower than pace of new construction.
     Annual housing starts are still below the 25-year average of roughly 1.3 million, even after having rebounded from the depths of the housing crash that triggered a recession nearly nine years ago.
     
     The Associated Press contributed to this report.

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