U.S. housing starts fall by biggest amount in nearly 25 years

WASHINGTON, Dec. 16 (Chinese media) -- U.S. construction of new homes fell by 18.9 percent in November, the steepest since March 1984, to a seasonally adjusted annual rate of 625,000 units, the lowest level on government records dating back to 1959, the Commerce Department reported Tuesday.

It was the fifth-straight monthly drop in housing starts. The November rate followed a downwardly revised October pace of 771,000 units and was far below the 740,000 units expected by analysts.

The report showed that single-family housing starts dropped 16.9 percent last month to a seasonally adjusted annual rate of 441,000 units. Multi-family housing starts, meanwhile, plunged by 26.9 percent to an annual rate of 166,000 units.

By region, new home construction plummeted by 34.6 percent in the Northeast and by 23.1 percent in the Midwest. Constructions in the South and in the West also fell by 15.6 percent and 16.8 percent respectively in November.

Permits for future groundbreaking, an indicator of builder confidence, plummeted 15.6 percent last month to an annual rate of616,000 units, a new record low pace, from an upwardly revised figure of 730,000 in October.

The U.S. housing industry is suffering its worst slump in decades. The severe housing downturn and a persisting credit crunch has been a major drag on the overall economy.

Many economists believe that the economic activity will continue to contract in the final quarter of this year and early next year, following a negative annual growth rate of 0.5 percent in the July-to-September period.