Housing starts slip from January

LOS ANGELES -- Housing starts fell 5.9 percent in February from the month prior, the latest sign that builders are acting cautiously in the face of competition from discounted bank-owned properties.

New housing units were built at a seasonally adjusted annual rate of 575,000 units in February, the Commerce Department said Tuesday, below the revised January estimate of 611,000, but still 0.2 percent above the 574,000 rate of February 2009.

Single-family homes fared better than multi-family units. Single-family homes were started at a rate of 499,000 units, 0.6 percent below the revised January figure of 502,000. The February rate for buildings with five units or more was 58,000, down 43.1 percent from a revised figure of 102,000 in January.

"Tight credit conditions, anemic demand and inventory pressure from the 'used' home market are all keeping builders on the gurney," Michael D. Larson, a housing and interest rate analyst with Weiss Research, wrote to clients Tuesday.

Starts were up 7.9 percent in the West and 10.6 percent in the Midwest, while they dropped 15.5 percent in the South and 9.6 percent in the Northeast.