WASHINGTON — U.S. housing starts in July rose less than economists estimated to a seasonally adjusted annual rate of 546,000 and building permits fell to a 14-month-low of 565,000, the Commerce Department reported Tuesday.
Economists expected 560,000 housing starts and 580,000 building permits in July, according to the median estimate from Thomson Reuters.
Building permits fell in every region except the South. Starts rose in the North and Midwest, fell in the South and were flat in the West.
Housing starts for June were revised downward to 537,000 from 549,000. June building permits were also revised lower to 583,000 from the 586,000 level originally reported last month.
"Falling mortgage rates have done little to stimulate demand now that homebuyer tax credits have expired," Diane Swonk, chief economist at Mesirow Financial, said in a research note. "Indeed, mortgage lending is one of the few areas that appears to have tightened rather than eased as credit markets continued to heal in recent months, which has caught the attention of the Fed."
