Housing Starts Fall 6% in September, but Permits Rise

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he Commerce Department said Tuesday housing starts fell 6% in September, the first decline in three months.

Work began on 1.898 million residential units, which include houses, townhouses and condominiums, at an annual rate last month, compared with a revised 2.02 million in August. The pace was the slowest since 1.817 million in June.

Construction of all types was hindered in the Southeast in September by hurricanes Frances, Ivan and Jeanne, Bloomberg reported. But despite the decline, the pace through September still was the highest in 26 years.

Falling construction likely means less business for flatbed trucking companies that haul building materials. Also, in the case of home construction, dry van freight can see a decrease in demand for the delivery of household appliances and furniture.

Construction permits, a sign of future activity, rose 1.8% to a pace of 2.005 million, a two-month high, Commerce said.

Starts of single-family homes fell 8.2% in September, the biggest drop since February 2003, to a 1.54 million-unit rate from a 1.678 million pace a month earlier.

Total starts dropped 1% in the South to a 904,000-unit annual rate; 7.9% to 465,000; 4.6% in the Midwest to 354,000; and 27% in the Northeast to 147,000.