Singlefamily housing starts fall 2.2 in June
Singlefamily building permits drop 2.3

WASHINGTON, July 17 Reuters U.S. singlefamily homebuilding fell to an eightmonth low in June amid higher mortgage rates, suggesting the housing market was likely a drag on economic growth in the second quarter.

The report from the Commerce Department on Wednesday also showed permits for future construction of singlefamily houses dropped to a oneyear low last month, indicating that any anticipated rebound in activity, if the Federal Reserve cuts interest rates in September as expected, could be muted.

Nonetheless, new construction remains underpinned by a shortage of previously owned houses for sale. That is keeping home prices elevated and combining with higher borrowing costs to make buying a house unaffordable.

The housing market has been hardest hit by the U.S. central bank39;s aggressive monetary policy tightening to quell inflation.

The country is not building enough singlefamily homes to alleviate the shortage of affordable housing and this is guaranteed to further inflate the housing price bubble and make the cost of buying a new home even more unaffordable, said Christopher Rupkey, chief economist at FWDBONDS.

Singlefamily housing starts, which account for the bulk of homebuilding, fell 2.2 to a seasonally adjusted annual rate of 980,000 units last month, the lowest level since last October, the Commerce Department39;s Census Bureau said.

Data for May was revised higher…