Housing starts in the U.S. fell to a 14-year low in October, signaling the real-estate slump will continue to weigh on growth, economists said before a report this week.
Construction fell 1.8 percent to an annual rate of 1.17 million homes, according to the median forecast of economists surveyed by Bloomberg News before a Commerce Department report on Nov. 20. Building permits, an indicator of future activity, fell 2.1 percent to a 1.2 million pace, economists forecast.
Sales are dropping and inventories are growing as the collapse in subprime lending and the prospect of further declines in property values scare away buyers. Tumbling residential construction will weaken the economy into 2008.
``The housing recession looks far from over,'' said Michelle Meyer, an economist at Lehman Brothers Holdings Inc. in New York. ``Builders continue to cut construction aggressively.''
A Nov. 19 report will reinforce the view that prospects for the housing market are worsening. The National Association of Home Builders/Wells Fargo index of builder confidence probably fell to a record-low 17 this month from 18 in October, according to the survey median.
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