U.S. housing starts rose moderately in March as builders resumed work at the end of an unusually cold winter, but home construction was slower than expected and applications for building permits fell, the government reported Wednesday, pointing to underlying weakness in the housing sector that could persist despite warming weather. The Commerce Department said housing starts rose to an annual rate of 946,000, up 2.8 percent from the February rate of 920,000. Economists expected a bigger March increase to a rate of 973,000, and housing starts were 5.9 percent below March 2013. Construction of single-family homes—the biggest component in the sector—jumped 6 percent, more than offsetting a 3.1 percent decline in construction of apartments and other multi-family homes. Applications for building permits, a gauge of future activity, fell 2.4 percent to an annual rate of 990,000. Analysts have been expecting the improving economy to lift the housing market, which has been recovering the past two years. But housing has struggled to maintain momentum. Rising home prices and higher mortgage rates have deterred some home buyers, while others have had trouble qualifying for mortgage loans. Meanwhile, builders complain of a shortage of lots and workers.
