Home construction in October fell 5.6 percent nationwide, the biggest dip since a 17.7 percent decline in March, and building permits, a sign of future activity, dropped by the most in six years, according to government data released Thursday.

The Commerce Department report was further evidence that rising mortgage rates and accelerating prices have begun to chill a market that’s been at a record pace for four years.

Lawrence builders already have been experiencing the slowdown. While builders took out 27 permits for single-family homes last month – the highest total for a month so far this year – the local industry remains caught in a slump.

The 178 single-family permits issued in Lawrence through October rank as the lowest total for the period since 1985. That’s back when mortgage interest rates were still above 10 percent, the lowest Americans had seen for at least five years.

This year’s pace in Lawrence is more than a third behind the average pace for the same period since 1985.

While several housing experts said the latest nationwide numbers confirmed that the residential boom likely had peaked, industry economists have noted that the pace had been unsustainable, leading the Federal Reserve to try to tamp down the “froth” by raising short-term interest rates eight consecutive times in the past 16 months.

The drop in housing starts was double what analysts had been expecting. Construction starts fell to a seasonally adjusted annual rate of 2.01 million units in October, down 5.6 percent from a revised September estimate of 2.13 million and down 2.3 percent from 2.06 million units in October 2004.

The slowdown in starts was in both single-family housing and multi-family construction and occurred in all regions of the country.

Permits dropped 6.7 percent to an annual rate of 2.07 million units, led by a 10.8 percent drop in the West. The slippage was the biggest since a 17.7 percent drop in September 1999, when permits fell from 16.7 million in August to 15.5 million.

“I think there is now accumulating evidence that the housing market peaked somewhere in the third quarter,” David Seiders, chief economist for the National Association of Home Builders, said Thursday. “Our survey of builder confidence, which came out yesterday, was down a lot. … It was the biggest drop since the first survey after 9/11.”