Singlefamily housing starts drop 4.3 in August
Singlefamily building permits increase 2.0
Overall housing starts plunge 11.3; permits up 6.9

WASHINGTON, Sept 19 Reuters U.S. homebuilding plunged to a more than threeyear low in August as a resurgence in mortgage rates weighed on demand for housing, but a jump in permits suggested new construction remained supported by a dearth of homes on the market.

The decline in housing starts reported by the Commerce Department on Tuesday was the largest in a year and occurred across the board. The report followed on the heels of news on Monday that homebuilders39; confidence slumped to a fivemonth low in September, with more builders reporting they were cutting prices and offering other incentives to lure buyers.

Home building, together with new home sales, have been the bright spots for the housing market, the sector hardest hit by the Federal Reserve39;s aggressive monetary policy tightening. The U.S. central bank is expected to leave interest rates unchanged on Wednesday, having raised its policy rate by 525 basis points since March 2022 to the current 5.255.50 range.

August39;s home construction data appear to be showing some cracks in the armor of what has been one of the few strong indicators in the housing market recently, said Daniel Vielhaber, an economist at Nationwide in Columbus, Ohio. Still, it39;s important to note that there could be a noise component here as much of the sharp decline in starts came from the…