New home construction in the nine-county metropolitan area fell for the third consecutive month in August.

The number of building permits filed locally dropped by 18 percent last month from the same time a year ago, falling from 354 to 290, according to figures from the Builders Association of Greater Indianapolis.

Sixty-six permits were filed in Marion County in August, down slightly from 67 in the same month last year and up from 46 last month. Hamilton County fared much worse, however. It saw a 29-percent decline in permits filed, from 139 in August 2009 to 98 last month.

The negative trend in local building permits started in June, when the number filed fell by 20 percent from the same month a year ago. July posted a 13-percent decline in permits.

But the two months previous weren’t much better. April was flat and May saw an increase of just 2 percent from the same month in 2009.

Generous federal tax credits that expired at the end of April likely led to the drop in permit filings.

Large increases in the number of building permits filed the first three months of the year have helped the nine-county area to outpace last year's pace through the first eight months of 2010. Through August, 2,733 permits had been filed, an 11-percent increase from the same time last year.

Nationally, home construction increased last month and applications for building permits also grew. But the gains were driven mainly by apartment and condominium construction, not the much larger single-family homes sector.

Nationally, construction of new homes and apartments rose 10.5 percent in August from a month earlier, to a seasonally adjusted annual rate of 598,000, the Commerce Department said Tuesday. That's the highest level since April.