New U.S. Home Construction in April Slumps by Most on Record

U.S. home construction starts plunged in April by the most in records back to 1959, as the nationwide lockdown to control the spread of the coronavirus hammered the housing market and broader economy. Residential starts plummeted 30.2% to an 891,000 annualized rate from a month earlier, the lowest level since February 2015, according to a government report released Tuesday. The median forecast in a Bloomberg survey called for a 900,000 pace. Applications to build, a proxy for future construction, dropped 20.8%, the most since July 2008, to a five-year low 1.07 million rate.

The slowdown in residential construction followed an 18.6% March slide, representing a rapid turn of events for the nation’s homebuilders, which were seeing solid demand entering 2020 on the heels of a steady job market and cheap borrowing costs. Sales and starts may begin to stabilize in coming months as most U.S. states relax business restrictions and mortgage rates hold near all-time lows.