Housing starts fell 4.1 percent to a seasonally adjusted annual rate of 657,000, compared with a downwardly revised figure for November of 685,000.
The rate of privately owned housing starts in the month was 24.9 percent above December 2010, when there were 526,000 housing starts.
Permits issued for privately owned housing units fell 0.1 percent month to month to an annual rate of 679,000. A year earlier in December, the annual rate stood at 630,000 permits. The new rate is a 7.8 percent climb over the rate 12 months prior.
Permits issued are an indicator of what direction construction starts might take one or two months down the road.
Completed housing projects in November were estimated at a seasonally adjusted annual rate of 605,000, which is 9.2 percent above the revised figure for November of 554,000 units and 7.1 percent above December 2010, when 565,000 housing completions were posted.