WASHINGTON — Housing starts dropped to a seasonally adjusted annual rate of 519,000 in October, an 18-month low, the Commerce Department reported Wednesday. Building permits increased to a 14 month-high of 550,000.
Economists expected annualized rates of 600,000 housing starts and 570,000 building permits in October, according to Thomson Reuters. September starts were revised lower to 588,000 from the 610,000 originally reported last month. September building permits were revised upward to 547,000 from 539,000.
“The market for new homes continues to battle it out with existing homes where prices have dropped further due to the onslaught of foreclosures,” Ellen Beeson Zentner, an economist at the Bank of Tokyo-Mitsubishi UFJ Ltd., said in a research note.
“Builders in many markets are unable to get proper financing to build, which is probably why we’ve seen a disconnect of late between builder sentiment and starts activity. A backlog of permits is building.”
