Housing starts dropped 9.8 percent from November's revised seasonally adjusted annual rate of 1,107,000 units.
Housing starts slipped to a seasonally adjusted annual rate of 999,000 a month after they climbed an attention-grabbing 22.7 percent.
Permits issued for housing projects dropped 3 percent November to December to a seasonally adjusted annual rate of 986,000.
While down month to month, permits issued were 4.6 percent higher than December 2012.
Permits for single-family housing units fell 4.8 percent below the revised November rate of 641,000. For multiple-unit housing projects with five or more separate living quarters, permits posted an annual rate of 350,000 in December.
The number of completed housing projects in December dropped 10.8 percent to a seasonally adjusted annual rate of 744,000 from November's revised rate of 834,000.
Completions were 10.7 percent above December 2012, however, when the annual rate was 672,000.