U.S. homebuilders began work at a slower pace in January than in December. But all of the drop occurred in the volatile area of apartment construction, which sank 24 percent. By contrast, the rate of single-family homebuilding rose 0.8 percent.
Even with the overall decline, the pace of home construction in January was the third-highest since 2008 and was evidence of continued strengthening in residential real estate.
And in an encouraging sign for the rest of the year, applications for building permits, a signal of future construction, topped December’s rate. Applications for permits are at their highest point since mid-2008.
The Commerce Department said Wednesday that builders started work at a seasonally adjusted annual rate of 890,000 homes last month. That was down 8.5 percent from December, when housing starts had hit an annual rate of 973,000, the most since June 2008.
Analysts had expected a decline on January construction, given the sharp gain in December. December initially had been reported at an annual rate of 920,000. On Wednesday, the department revised up the December pace to 973,000.
January’s was only the second drop in construction in the past six months. It still left the annual pace of homebuilding 23.6 percent higher than a year ago.