Permits ran at a seasonally adjusted annual 1.263 million pace during the month, 0.6% lower than in September and 6% lower than year-ago levels.
What happened: Builders broke ground on more homes in October, but they applied for fewer permits to start work in the future, another reminder that housing market activity is still moving in fits and starts.
But construction activity is clearly slowing.
Year-to-date, starts were only 3.9% higher than in the same period of 2017.
Another measurement, single-family starts, is also losing ground.
In October, they were 1.8% lower than in September and 2.6% lower than a year ago.
Analysts watch single-family starts closely because those homes are mostly built for purchase, rather than rent.
What they’re saying: “With rising mortgage rates and increases in house prices that continue to outstrip disposable income, housing affordability has dropped notably since peaking in 2012,” UBS analysts wrote in a recent note.
Economics analysts said after the release.
“We should see a lift for all the housing data from disaster rebuilding as we approach 2019.” Market reaction: Stocks tumbled Monday on the heels of a disappointing report on home-builder confidence, among other issues.