Housing starts in October rose 1.5% from September to a seasonally adjusted annual rate of 1,228,000, 2.9% below the October 2017 rate of 1,265,000, the Commerce Department reported Tuesday.

Single‐family housing starts in October were at a rate of 865,000, 1.8% below the revised September figure of 881,000. The October rate for units in buildings with five units or more was 343,000.

Building permits in October fell 0.6% sequentially to at a seasonally adjusted annual rate of 1,263,000., 6.0% below the October 2017 rate of 1,343,000.

Single‐family authorizations in October were at a rate of 849,000; also 0.6% below the revised September figure of 854,000. Authorizations of units in buildings with five units or more were at a rate of 376,000 in October.

Housing completions in October were at a seasonally adjusted annual rate of 1,111,000, 3.3% below the revised September estimate of 1,149,000 and 6.5% below the October 2017 rate of 1,188,000. Single‐family housing completions in October were at a rate of 832,000, 1.2% below the revised September rate of 842,000. The October rate for units in buildings with five units or more was 269,000.

Joel Kan, AVP of economic and industry forecasting at the Mortgage Bankers Association, analyzed the report. “Single-family starts dropped for the second straight month in October to 865,000 units, the slowest pace in four months," Kan said in a statement. "Single-family starts in October decreased year-over-year, the largest drop since March 2015 and for only the second time since then. The South drove much of the monthly decrease, with the pace slowing by almost 20,000 units over the month to its slowest pace since September 2017. Since August, the South has seen a 50,000 unit or 10% drop in housing starts. In addition to the struggles that home builders are facing in terms of labor shortages and input costs, some of this was likely some lingering weakness following the storms that hit the region this summer. Overall, housing supply continues to lag overall demand.”