Construction of U.S. single-family houses in April dropped to the lowest level in 17 years, even as building of condominiums and town houses rebounded.

Builders broke ground on 692,000 single-family homes, at an annual rate, the fewest since January 1991, the Commerce Department said yesterday.

Total housing starts jumped 8.2 percent to 1.032 million as construction of multifamily units rose 36 percent after a 35 percent drop in March.

"There may be signs that we are getting close to a bottom, but we don't think we're there yet," said Adam York, an economist at Wachovia Corp. in Charlotte, N.C. "The housing market still has a ways to go toward working off its problems."

Gray Stettinius, president of the Home Building Association of Richmond, said new homes at $275,000 or less are selling in the Richmond area.

"The higher price points are holding their own, but neither is setting the world on fire," said Stettinius, president of Tuckahoe Creek Construction Inc. in Goochland County.

"What I hear over a sandwich or a cup of coffee is that houses from $275,000 to $1.2 million are moving slowly."

Tom Tyler, a senior analyst with Integra Realty Resources-Richmond, said it looks like the Richmond region is still experiencing a drop in the number of building permits. However, he does not have the complete data for the first quarter.

"The rate of decline has been dropping, so the market is not getting a lot worse," he said. "The decline is slowing."

But like the nation, the region is seeing more activity with new condominiums and town houses as their market share of sales increases, according to Integra Realty.
Staff writer Carol Hazard and Bloomberg News contributed to this report.