New residential construction in the U.S. tumbled by much more than expected in the month of July, according to a report released by the Commerce Department on Tuesday.
The report showed housing starts plunged by 9.6 percent to an annual rate of 1.446 million in July after slumping by 2.4 percent to a rate of 1.559 million in June. Economists had expected housing starts to decline by 1.2 percent to a rate of 1.540 million.
With the much steeper than expected drop, housing starts dove to their lowest annual rate since hitting 1.430 million in February of 2021.
Building permits, an indicator of future housing demand, also fell by 1.3 percent to an annual rate of 1.674 million after inching up by 0.1 percent to a revised rate of 1.696 million in June.
Economists had expected building permits to tumble by 2.1 percent to an annual rate of 1.650 million from the 1.685 million originally reported for the previous month.