NEW YORK (CNNMoney.com) -- New home construction ticked higher in July, but indications of future building were weak, the government said Tuesday.
Housing starts rose 1.7% from June to a seasonally adjusted annual rate of 546,000 last month, the Commerce Department said.
Economists were expecting housing starts to rise to 555,000, according to a consensus estimate from Briefing.com.
On a year-over-year basis, starts fell 7% from July 2009.
"Activity in the housing market is likely to remain depressed for several years," Paul Ashworth, U.S. economist at Capital Economics, said in a research note. "Housing is not going to lead the economic recovery."
Future activity: Applications for building permits, a gauge of future construction activity, fell over the month. Permits dropped to a seasonally adjusted annual rate of 565,000 in July, down 3.1% from a revised 583,000 in June.
Economists were expecting a more modest drop to 573,000. Permits were down 3.7% from the same time last year.
"[The permits figure] is not an encouraging sign," Ashworth said. "The 'good' news, however, is that housing is so depressed it is hard to see activity falling much further from such a severely depressed level."
New homes by sector: New construction of single-family homes, the key sector of the housing market, fell 1.2% over the month to an annual rate of 421,000.
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||4.01%||3.96%|
|15 yr fixed||3.14%||3.12%|
|30 yr refi||4.05%||3.99%|
|15 yr refi||3.16%||3.14%|
Today's featured rates:
Uber's CEO has ordered an 'urgent' investigation as sexual harassment allegations by a former employee gain a big online response. More
Plenty of reporters say President Trump's White House is in 'chaos.' But there's one big thing going right for him right now: The U.S. economy. More
In 1998, Ntsiki Biyela won a scholarship to study wine making. Now she's about to launch her own brand. More
Pay yourself first; donate stuff you don't need to charity and remember to claim deductions; finally, cut your recurring expenses. More