Housing Starts Hit 17-Year Low

Washington, DC, Sept. 17, 2008--Home construction fell a second month in a row during August, falling below expectations to the lowest level in 17 years.

Housing starts decreased 6.2 percent last month to a seasonally adjusted 895,000 annual rate, the Commerce Department said Wednesday.

Single-family home starts also declined, and building permits fell sharply. The level of 895,000 was the lowest since 798,000 in January 1991.

July housing starts decreased 12.4% to 954,000, revised down from the originally reported drop of 11.0 percent to 965,000-unit annual rate.

Wednesday's data showed housing starts year over year in August were 33.1 percent below the year-ago level.

Building permits fell by 8.9 percent to a 854,000 rate in August. July permits plunged 17.7 percent to 937,000. Permits are a sign of actual building in the future. The level of 854,000 was the lowest since 853,000 in February 1991.

August single-family housing starts decreased 1.9 percent to 630,000. Construction of housing with two or more units fell 15.1 percent to 265,000.

Regionally, housing starts decreased 7.4 percent in the South, 14.5 percent in the Northeast, and 13.6 percent in the Midwest.

Starts increased 10.8 percent in the West.