New construction on US houses fell 7.8 per cent to its lowest level in a year, the Commerce Department reported this afternoon.
The decline to a seasonally adjusted annual rate of 1.960 million units in March was larger than expected.
New construction of single-family homes fell 12 per cent to a seasonally adjusted annual rate of 1.591 million.
A total of 2.059 million annualised building permits were authorised by local government jurisdictions, down 5.5 per cent from February's 2.179 million pace. This is the biggest decline in permits since September 1999. Permits are also at their lowest level in a year.
The Federal Reserve is looking for housing to slow at a moderate pace this year. If the market looks headed for an outright collapse, it could bring a quick end to Fed tightening.
But it is unlikely the Fed would react to any one month's housing numbers, especially considering the rampant scepticism at the Fed that even falling home prices would curb consumer spending.