PREVIEW-US housing starts to rise in Jan, permits to fall

* WHAT: January housing starts, building permits

* WHEN: Wednesday, Feb. 17 at 8:30 a.m. (1330 GMT)

REUTERS FORECAST:

* The median forecast for housing starts is for a rise to an annual rate of 580,000 units in January after having fallen to 557,000 units in December. Forecasts range from 530,000 to 630,000 units.

* The median forecast for building permits is for a slip to 620,000 units in January after having risen to 653,000 units in December. Forecasts range from 540,000 to 670,000 units.

FACTORS TO WATCH:

Unusually cold weather caused a drop in groundbreaking activity in December. But building permits, which give a sense of future home construction, jumped to their highest level in 14 months. This suggests that housing starts likely rebounded in January, though analysts caution that inclement weather may cause the strength from permits to be slow to feed through to groundbreaking activity.

Building permits are expected to have dropped in January. The housing market is recovering from a three-year slump that pushed the U.S. economy into its worst downturn since the Great Depression. But the government-driven recovery is showing signs of exhaustion, amid high unemployment and a flood of foreclosed properties.

Housing starts are below the pace of new home sales, while the inventory of houses under construction dropped to a record low in December. Some analysts see little room for starts to rise while sales remain stable.

Homebuilders' sentiment remains stuck at low levels, but analysts believe there is little risk of a double-dip, which could imperil the broader economic recovery. Groundbreaking activity expected to maintain a moderate upward trend. (Reporting by Lucia Mutikani; Editing by Leslie Adler)