U.S. housing starts fell in January as groundbreaking for single-family projects slipped off a six-and-a-half-year peak, but stayed at levels consistent with a gradually improving housing market.
Groundbreaking declined 2% to a seasonally adjusted annual pace of 1.07 million units, according to figures released Wednesday by the U.S. Commerce Department.
December's starts were barely revised at a 1.09 million-unit pace and January's reading was in line with Wall Street's expectations.
Starts have now been above the one-million-unit mark for five straight months. Compared to January last year, groundbreaking was up 18.7%.
Sluggish wage growth and a shortage of homes on the market stymied housing last year, even as the broader economy was accelerating.
But a turnaround in housing is expected this year as a rapidly tightening labour market pushes up wages and encourages more young adults to move out of their parents' basements and set up their own homes.
Single-family-home groundbreaking, the largest part of the market, dropped 6.7% to a 678,000-unit pace. Starts in this segment had hit their highest level since early 2008 in December.
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