US homebuilding dropped significantly in January, as winter storms and higher mortgage rates stymied progress on the housing shortage.
Housing starts, a measure of new home construction, fell by 14.8%, compared with the previous month, according to data released Friday by the Census Bureau. It was the biggest monthly drop since April 2020.
Starts fell to a seasonally adjusted annual rate of 1.331 million last month, well short of expectations of 1.46 million and hitting the slowest pace since August.
Building permits also dropped in January, down 1.5% from December’s revised number to a seasonally adjusted annual rate of 1.470 million.
Permits were still 8.6% above a year ago.
“Housing starts collapsed in January,” said Lawrence Yun, chief economist at the National Association of Realtors, in a statement. “More snow than usual fell across parts of the country, but the seasonally adjusted data implies a continuing housing shortage ahead.”
