U.S. housing starts fall 5.8% to 654,000 in March (by Jeffry Bartash)

WASHINGTON (MarketWatch) - Builders began construction on new U.S. homes at a slower pace in March, but permits jumped to the highest level since September 2008, the Commerce Department reported Tuesday. Housing starts fell 5.8% last month to an annual rate of 654,000 from a slightly revised 694,000 in February. Economists surveyed by MarketWatch had expected housing starts in March to rise to an annual rate of 703,000 on a seasonally adjusted basis. Yet permits climbed 4.5% to 747,000 in March from a revised 715,000 in February, mainly because of a spike in requests to construct multi-dwelling buildings with five units or more. Permits for new construction are viewed as a gauge of future demand and the latest increase suggests builders are becoming more optimistic. On the other hand, permits for single-family homes dropped 3.5% to 462,000 in March from 479,000 in the prior month. Single-family homes account for about three-quarters of the market for new housing. Over the past 12 months, housing starts are up 10.3%.