U.S. Housing Starts Fell to Record Low in January (Courtney Schlisserman)

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  Feb. 18 (Bloomberg) -- U.S. builders broke ground in January on the fewest houses on record as a lack of credit and plunging sales exacerbated the worst real-estate slump since the Great Depression.

  Housing starts plunged 17 percent last month to an annual rate of 466,000, lower than projected, according to figures from the Commerce Department today in Washington. A report from the Federal Reserve showed industrial output sank in January for the sixth time in seven months.

  Builders are struggling as record foreclosures swell the glut of homes on the market, undermining efforts to revive demand and lighten inventory by cutting prices. President Barack Obama today said his administration will use $75 billion to bring down mortgage rates and encourage loan modifications to stem repossessions.

  “The problem with the build-up in inventory is coming from the increasing number of foreclosures,” Nicolas Retsinas, director of Harvard University’s Joint Center for Housing Studies in Cambridge, Massachusetts, said in a Bloomberg Television interview. “It’s about time the government intervened so directly in the problem.”

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