Housing starts in the U.S. declined in February due to a slowdown in apartment building and only modest increases in single-family construction. According to the U.S. Department of Commerce total housing starts dropped seven percent last month compared to January bringing the seasonally adjusted annual rate to 1.236 million units.
The overall rate was dragged down by a significant decline, 26.1 percent, in multifamily construction. Single-family starts rose a modest 2.9 percent during the month.
Rising material costs and labor shortages are hindering growth in housing starts according to the National Association of Home Builders. Stagnation in new home construction is likely to only intensify the existing housing shortage.
Meanwhile, conforming no-point 30-year fixed mortgage rates averaging 4.375 percent, 15-year rates near 3.875 percent and the 5-year ARM averaging 4 percent.
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