New home construction and building permits plunged more than expected in January amid severe winter weather in large parts of the United States, official data shows.

Housing starts plummeted 16.0 per cent from December to a seasonally adjusted annual rate of 880,000, the Commerce Department said on Wednesday.

The decline was broad-based, including a 15.9 per cent drop in starts on single-family homes, the largest part of the US housing market.

New construction of multi-family structures of five units or more fell by 12.8 per cent over the month.

Building permits in January dropped to a rate of 937,000, down 5.4 per cent from December.

The report came in well below analysts’ expectations. The consensus estimate was 963,000 starts and 980,000 building permits, an indicator of future construction.

The wintry blast of cold and snow storms across parts of the country weighed on the home construction sector, notably in the Midwest, where starts fell to a record low, the Commerce Department said.

“Terrible, but we just don’t know how much of the weakness is weather-related,” said Ian Shepherdson of Pantheon Macroeconomics.

“We are reluctant to draw any firm conclusions until we see what happens to activity when the snow stops.”

On an annual basis, starts fell 2.0 per cent from January 2013, to 898,000, the lowest level since August 2011.

Building permits, however, were up 2.4 per cent from a year ago.