US home building stagnant

WASHINGTON (AFP) – Construction of new homes in the United States grew by nearly 15 percent last month, but remained near levels seen since the sub-prime mortgage meltdown, official data showed Wednesday.

At an annual rate of 596,000 starts, building in January was 2.6 percent below the levels seen in the same month last year, according to Commerce Department figures.

It was a “quite disappointing report, despite the increase in the overall housing starts figure,” said Inna Mufteeva, an economist with Natixis, who described sentiment in the sector as “anemic.”

Adding to the bleak outlook, building permits were 10.4 percent below the levels seen in December and 10.7 percent below last January.

But experts predicted those low rates of permitting and building would pick up as the recovery progresses.

“(The market) should eventually be supported by the extremely low inventories of new homes and decent homes sales expected on the housing market,” said Mufteeva.