U.S. housing construction plunged to a record low in April, largely due to a steep drop in building apartment units.
Tuesday's Commerce Department report says builders started nearly 13 percent fewer projects during the month.
If construction continued at that pace for a whole year, just 458,000 units would go up, which is a record low.
A gauge of future construction projects, the number of building permits issued, also fell to a record low, a discouraging sign for investors hoping the sector was headed for recovery.
Economists had been expecting a modest increase in housing starts as sales and other indicators had been rebounding from very low levels recently.
Problems in the housing sector played a key role in sparking the economic crisis.
While housing starts are down, profits are improving at the world's largest home improvement retailer.
U.S.-based Home Depot said Tuesday its profit for the three months ending May 3 jumped 44 percent compared to the same period last year.
Home Depot said net profit for the quarter rose to $514 million, due in part to an aggressive restructuring plan and thousands of layoffs.
Retailers like Home Depot have been among the hardest hit as consumers reduce their spending, especially on expensive items needed for home repairs, during the recession.
On Monday, rival home improvement retailer Lowe's said it is seeing signs that consumer confidence is increasing, which could indicate the worst of the recession is over.
Some information for this report was provided by AP and Reuters.
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