WASHINGTON – U.S. homebuilding unexpectedly fell in April amid a persistent decline in the construction of multi-family housing units and a modest rebound in single-family projects, pointing to a slowdown in the housing market recovery.

Housing starts dropped 2.6 percent to a seasonally adjusted annual rate of 1.17 million units, the Commerce Department said on Tuesday. That was the lowest level since last November and followed a downwardly revised rate of 1.20 million units in March.

Economists polled by Reuters had forecast groundbreaking activity rising to a rate of 1.26 million units last month from a previously reported rate of 1.22 million units in March.

Homebuilding increased 0.7 percent on a year-on-year basis.

Single-family homebuilding, which accounts for the largest share of the residential housing market, rebounded 0.4 percent to a pace of 835,000 units last month. That left the bulk of the 5.1 percent decline in March intact.

Single-family starts surged 19.4 percent in the Midwest and advanced 9.1 percent in the West. They fell 3.4 percent in the South and tumbled 29.2 percent in the Northeast.

Some of the drop in starts, especially in the Northeast, could be weather-related after a snowstorm lashed the region in March. Demand for housing remains underpinned by a tightening labor market, characterized by an unemployment rate at a 10-year low of 4.4 percent.

A survey on Monday showed homebuilders’ confidence rose in May, with bullishness about current sales and over the next six months.

Last month, starts for the volatile multi-family housing segment dropped 9.2 percent to a pace of 337,000 units. Multi-family starts have declined for four straight months.

Building permits fell 2.5 percent, driven by a 4.5 percent drop percent in the single-family segment. Multi-family permits rose 1.4 percent.

((Reporting by Lucia Mutikani; Editing by Paul Simao))