New residential construction rebounded by much less than expected in the month of July, the Commerce Department revealed in a report released on Thursday.
The report said housing starts rose by 0.9 percent to an annual rate of 1.168 million in July after plunging by 12.9 percent to a revised rate of 1.158 million in June.
Economists had expected housing starts to soar by 7.4 percent to an annual rate of 1.260 million from the 1.173 million originally reported for the previous month.
Single-family housing starts climbed by 0.9 percent in July after tumbling by 9.0 percent in June, while multi-family starts increased by 0.7 percent after plummeting by 22.3 percent.
The Commerce Department also said building permits advanced by 1.5 percent to an annual rate of 1.311 million in July after dipping by 0.7 percent to a revised rate of 1.292 million in June.
Building permits, an indicator of future housing demand, had been expected to jump by 2.9 percent to a rate of 1.310 million from the 1.273 million originally reported for the previous month.
While single-family building permits surged up by 1.9 percent in July after climbing by 1.2 percent in June, multi-family permits rose by 0.7 percent after slumping by 4.1 percent.
On Wednesday, the National Association of Home Builders released a separate report showing a modest deterioration in homebuilder confidence in the month of August due in part to growing affordability concerns.
The report said the NAHB/Wells Fargo Housing Market Index edged down to 67 in August from 68 in June, matching economist estimates.