Housing construction plunged to the second-lowest level on record last month, providing a sobering sign that the worst housing slump in decades has not ended. Construction of new homes dropped by nearly 11% , the second-lowest construction pace in records that go back 50 years. The decline was worse than economists expected; February activity was revised lower as well.
The Commerce Department figures are more evidence that the steep slump in housing—which was a major factor triggering the current recession—has yet to run its course. The report showed that applications for building permits, considered a good barometer of future activity, also fell lower than expected, dropping 9%. The biggest declines were in the Midwest and Northeast.