More bad signs for the housing market.
New housing starts fell sharply in December and building permits fell to their lowest level since May, the government reported today.
The numbers appear to reflect the effect of the slight slowing in the housing market from a peak established during the summer of last year. The Commerce Department said the number of homes that builders started constructing last month fell 8.9 percent, to an annual pace of 1.93 million, and the number of permits issued dropped 4.4 percent, to a pace of 2.07 million.
Economists had expected housing starts at an annual pace 2.04 million and permits to total 2.1 million, according to a survey by Bloomberg News.
“Of that 8.9 percent, maybe a third of it was weather-related,” said Nariman Behravesh, chief economist at Global Insight. “The rest of it is underlying trend of weakness in the housing market. You are seeing pervasive signs of weakness.”