US housing starts slumped 8.7 percent in February

WASHINGTON (AP) — The number of homes under construction fell 8.7 percent in February, as ground breakings for single-family houses plunged to their lowest level in nearly two years.

The Commerce Department says builders started construction at a seasonally adjusted annual rate of 1.16 million units last month, down from a 1.27 million pace in January. The setback stems from a 17 percent drop in the building of single-family houses, which posted the weakest pace since May 2017.

Home construction is running nearly 1.9 percent below last year’s pace. Lower mortgage rates at the start of 2019 appear to be boosting demand for housing, but builders are contending with rising costs for labor and land.

Housing permits, an indicator of future activity, fell 1.6 percent to an annual rate of 1.30 million.