Overall Housing Starts Fall, But Single Family Up

Washington, DC, Aug. 18, 2009--Housing starts edged lower in July following a surge in the previous month, according to the Commerce Department.

Housing starts fell to a seasonally adjusted annual rate of 581,000, down 1% from a revised 587,000 in June, the Commerce Department said.

Economists were expecting housing starts to increase to an annual rate of 599,000 units.

The recession has cut deeply into consumer demand and access to financing. Housing starts for July were 37.7% lower than the July 2008 rate of 933,000.

Meanwhile, applications for building permits, an indication of future construction activity, dipped 1.8% to a seasonally adjusted annual rate of 560,000 in July. Economists were looking for the forward-looking measure to increase to an annual rate of 577,000 units.

Building permits were 39.4% below the July 2008 rate of 924,000.

One indication of strength was single-family housing starts, considered the core of the housing market, which managed to gain 1.7% in July after rising sharply the previous month. Single-family building permits rose 5.8% in June.

As the single-family segment showed signs of improvement, however, the multi-family segment continued to get hit hard, pulling topline numbers lower.