US housing starts hit 16-year low

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US construction figures for November have showed that house building is still depressed, despite the recent cuts in the cost of borrowing.

The number of single-family homes started in the US fell 5.4% in November to its lowest level since April 1991.

The annualised figure from the Commerce Department fell to 829,000 from October's revised figure of 1.232m.

Housing starts have now fallen by 24.2% since November 2006, showing a lack of confidence in the sector from builders.

Overall construction fell by 3.7% to 1.187m, although that figure was still better than had been expected.

"This is not a bottom here - we have returned almost to the levels we saw in September," said Adam York from Wachovia Securities in North Carolina.

"We are still not looking for a bottom in starts until the middle of 2008, probably another 100,000 to 200,000 down from here."