WASHINGTON -- Total housing starts dropped 6% in August to a seasonally adjusted annual rate of 1.685 million units, according to figures released by the U.S. Department of Commerce. The pace of new-home construction was down 19.8% from a year earlier, which was a record-breaking year.
The pace of single-family home construction slowed by 5.9% to 1.360 million units in August, a 20.6% drop from a year earlier. Multifamily housing construction was down 6.7% from August 2005.
David Seiders, chief economist of the National Association of Home Builders, said, "We are in the midst of an inevitable adjustment following this housing boom of 2004-2005 when housing market activity soared to unsustainable levels. This downward adjustment to housing production should run its course by mid-2007. The market that emerges from this correction will display good balance between supply and demand and move to a healthy and sustainable trend based on solid underlying fundamentals."
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