Home construction in the U.S. dropped at the end of last year despite a shortage of homes. According to the U.S. Commerce Department, groundbreakings on new homes fell 8.2% in December.
The pullback is taking place even as would-be buyers compete for a shrinking pool of available homes. This in turn has caused prices to surge faster than wage growth.
The hot housing market is being fueled by a robust economy and a strengthening job market. The unemployment rate currently stands at 4.1% -- a 17-year low.