Marking the first decline since August this year, the housing starts in the United States dropped 1.6 percent to a 1.03 million annualized rate in November from a revised 1.05 million pace in October.
According to the US Commerce Department report, the depression was led by a plunge in the South as groundbreaking for single-family homes fell after two hefty rises, while other areas registered increases.
Housing starts fell to a seasonally adjusted annual pace of 1.028 million units, according to the figures released by the Commerce Department on Tuesday. The starts recorded in October were revised up to a 1.045 million-unit pace.
Meanwhile, the market analysts said that even if November reported a decline in housing starts, but the groundbreaking is up 7.7 percent in comparison to the first 11 months of last year.
This year, the starts have averaged a 990,000-unit pace till November, which is a surge from an average 930,000-unit rate in 2013.
Joel Naroff, chief economist at Naroff Economic Advisors in Holland Pennsylvania, said, “It is hard to complain about the housing sector in the United States. The American economy is moving on an accelerating growth trajectory that must continue for quite some time. There is no requirement of a robust housing market to drive growth.”
As per the Wall Street forecast, the starts were expected to rise at a pace of 1.04 million units from the October’s pace of 1.01 million units.
Meanwhile, the US stocks increased sharply while trading in volatile market, while prices for the US Treasury debt also rose significantly. The greenback fell against a basket of other currencies.
The US also faces a big challenge from the slow pace of household formation. Moreover, the high rate of unemployment among young adults has also forced many of them to continue living with their parents at one home or share accommodations with friends or relatives.