The pace of U.S. home building fell more than expected in June as groundbreaking on single-family units logged the slowest pace in 1-1/2 years, according to a government report on Wednesday that added to signs of a broad cooling in the market.

The Commerce Department said June housing starts fell 5.3 percent in June to a 1.850 million unit annual pace, from a downwardly revised 1.953 million unit pace in May. May's rise had interrupted a string of three straight monthly declines.

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Economists had expected June housing starts to decline to 1.90 million units from May's originally reported 1.957 million unit pace.

Permits for future groundbreaking, an indicator of builder confidence, fell 4.3 percent to a 1.862 million unit pace, the slowest since May 2003. Economists polled by Reuters had expected June permits to fall to 1.920 million units after an upwardly revised 1.946 million units, originally reported as 1.932 million.

U.S. single-family housing starts fell 6.5 percent to an annual pace of 1.486 million units, the slowest since November 2004.

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