Housing Starts Fall 3.6% in June

Construction of new single-family homes slowed by 3.6% in June to a annual pace of 1.672 million homes, a report by the Commerce Department said Wednesday.

Increased construction likely means more business for flatbed trucking companies that haul building materials. Also, in the case of home construction, dry van freight can see an increase in demand for the delivery of household appliances and furniture.

Despite the slowdown, the annual rate of home sales through June exceeds the number of homes started in 2001 – which had been the third-best year for housing starts since 1988.

Economists said that increasing sales of homes, coupled with a low inventory of new homes, are keeping homebuilders busy and should keeping figures for housing starts strong in 2002, Bloomberg reported.

The drop in new housing starts was slightly more than expected, Bloomberg said.

So far this year, builders have started work on 840,000 homes, compared with 808,000 in the first six months of 2001, the report said.

By region, starts fell 0.9% in the Midwest, 2.2% in the West and 7.6% in the South to 744,000. Starts rose 6.1% in the Northeast.

Commerce said building permits increased 1.4% in June, which is a sign construction will pick up in the months ahead.