US home building drops 4.7%

Construction of new US homes fell to a one-year low in September as hurricane-damaged housing markets struggled to recover from August and September’s back-to-back hurricanes, government data showed yesterday.

However, US regions not affected by Hurricanes Harvey and Irma also saw steep drops in home building.

After nearly a decade of economic recovery, analysts say rising wages and steady job creation have created strong demand for homes. But rising input costs and a shortage of workers have kept the market very tight.

Total housing starts fell 4.7 percent in September to a seasonally adjusted annual rate of 1.13 million units, the third straight monthly decline and the lowest pace of construction since September of last year, according to the Commerce Department.

Analysts had expected a decline of only 1.9 percent.

And in a sign that relief may not be around the corner, permits for new construction also fell 4.5 percent for the month to an annual rate of 1.21 million, seasonally adjusted, the lowest rate since May.

Federally declared disaster zones in Florida and Texas, struck by Irma and Harvey, together accounted for about 13 percent of all US housing permits in 2016. While the Commerce Department says it does not produce local estimates for construction, the southern region saw a 9.3 percent decline.