This is the result of overbuilding in the bubble years. It going to take about 40 months for the inventory to clear and building to get underway again. And it won't be as vigorous as during the bubble years.
The Commerce Department said overall construction starts plummeted 11.7 percent to a 519,000 annual rate from a downwardly revised 588,000 in September.
It was the weakest starts rate since 477,000 in April 2009 when the economy was still coping with the severe impact of the 2007-2008 financial crisis.
Economists surveyed by Reuters had anticipated a starts rate in October of 600,000 -- far higher than the actual outcome.
Read it allPermit applications for new building edged up to 550,000 last month from an upwardly revised 547,000 in September, potentially a sign that builders hope for better times ahead.
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