Housing starts plummeted 12.3 percent in June

(CN) — Housing starts plunged 12.3 percent in June, led by a dramatic  35.8 decline in the Midwest, the Commerce Department said Wednesday.

The government report said housing starts fell to a seasonally adjusted annual rate of 1.17 million from 1.34 million in May.

June’s pace of construction was the lowest since September 2017.

In addition to the sharp drop in construction activity in the Midwest, housing starts were down 9.1 percent in the South, 6.8 percent in the Northeast, and 3 percent in the West.

Permits, an indicator of upcoming construction, also declined 2.2 percent in June from the previous month, the government said.

But the sobering numbers are largely being greeted as an aberration. For the first half of 2018 new home construction has climbed 7.8 percent year-to-date.

As a result, a separate measure, the National Association of Home Builders/Wells Fargo builder sentiment index continues to reflect builder confidence. The measure for June was a solid 68. Any reading above 50 signals growth.