The U.S. Census Bureau and the Department of Housing and Urban Development reported Tuesday morning that new housing starts in March fell to a seasonally adjusted annual rate of 1.215 million, a decrease of 6.8% from the upwardly revised February rate of 1.303 million and an increase of 9.2% compared with the March 2016 rate of 1.113 million. The consensus estimate from a survey of economists expected a rate of around 1.262 million.

The revision to the February rate added 15,000 new housing starts from the previously reported total.

PNC Financial is forecasting housing starts of just over 1.2 million this year, up 3.6% from 2016. Affordability remains good, although the effective cost of new homes will gradually increase over the next few years as mortgage rates move higher.

The seasonally adjusted rate of new building permits rose in March to 1.260 million, up 3.6% from the upwardly revised February rate of 1.216 million and up 17% from the March 2016 rate of 1.077 million. The consensus estimate called for 1.250 million new building permits.

Single-family housing starts rose in January to an annualized rate of 821,000, down 6.2% from the revised February rate of 875,000. Single-family starts rose 9.3% year over year in March.

Permits for new single-family homes fell 1.1% month over month in March, to an adjusted annual rate of 823,000, from a revised total of 832,000 in February. The rate rose 13.5% year over year.

Multifamily starts for buildings with five or more units increased by 9.1% year over year in March and fell by 6.1% compared with February.

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