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Apr-16-2008New home construction at 17-year low(topic overview)
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FXstreet.com (Barcelona) - The U.S. housing market crisis does not seem to have an end at sight, as the amount of housing starts fell to the lowest level of the last 17 years in March, according to data released by the U.S. Commerce Department. The annual pace of housing starts has dropped 11.9% to 947,000 yearly rate, down from the revised 1.075 million annual rate posted in February, this means a 36.5% decline in the last twelve months, as in March 2007, the annual pace of housing starts posted a rate of 1,491,000. [1] Privately owned housing starts fell to a seasonally adjusted 947,000 annual rate in March, according to the Commerce Department.[2]
The Commerce Department reported today that new-home starts fell 11.9 percent in March from February to an annual rate of 947,000 homes. This was the fewest number of starts since March 1991.[3] Work began on 947,000 homes at an annual rate, down 11.9 percent from February and the fewest since March 1991, the Commerce Department said today in Washington.[4]
Work on single-family homes decreased 5.7 percent to a 680,000 pace, Commerce said. Construction of multifamily homes, such as townhouses and apartment buildings, fell 25 percent to an annual rate of 267,000 in March.[4] Applications for building permits, considered a reliable sign of future construction activity, fell to a seasonally adjusted annual rate of 927,000 in March. That's 5.8% below the revised 984,000 rate in February.[2] Building permits, a leading indicator of housing construction, fell 5.8% to a seasonally adjusted annual rate of 927,000. This is the lowest level of permits since April 1991.[5]
The number of homes begun in March fell 11% to an annual rate below one million, well below forecasts. The number of permits granted dropped 6% to their lowest level since April 1991.[6] Building permits, regarded as an important barometer of future construction activity, dropped to an annual rate of 927,000 - again below analysts' forecasts of 970,000. "It is a dismal report," Richard Dekaser, chief economist at National City Corporation, said of the latest figures. "It challenges the proposition that construction has scraped the bottom.[6] The outlook for the construction sector does not look much brighter indeed, as building permits, a gauge used in order to assess construction activity over the next months, has declined 5.8% in March to a seasonally adjusted annual rate of 927,000.[1]
The U.S. housing market continues to ebb with the number of new home starts and building permits issued in March remaining extremely weak.[6] Single-family building permits declined 6.2 percent nationwide. "Homebuilding continues to collapse as builders struggle to work off their bloated inventories of unsold homes and try to survive," said Mark Zandi, chief economist at Moody's Economy.com in West Chester. "The over 60 percent decline in housing starts from their peak two years ago is the largest since the Great Depression."[3] Residential building has subtracted from economic growth since the first three months of 2006, culminating in a 25 percent decline last year that was the biggest since 1980. The National Association of Home Builders yesterday forecast housing starts would fall 30 percent this year, compared with a previously estimated 27 percent drop, as the credit crisis persists. "It's now clear that we have entered what we anticipate will be a mild recession,'' David Seiders, chief economist for the homebuilders' group, said in a statement. As property values tumble and adjustable-rate mortgages reset, more Americans are walking away from their homes.[4]
April 16 (Bloomberg) -- Housing starts in the U.S. dropped more than twice as much as forecast in March to a 17-year low, signaling that declining construction will keep eroding economic growth this year.[4]
New construction of single-family homes, considered the core of the housing market, were at a rate of 680,000, or 5.7% below last month's number. Single-family housing starts have not been this low since May 1980.[2] March housing starts plunged 11.9% as multi-family starts provided the drag with a 25% drop. The 947,000 level is below the 17-year low of December as starts wait for sales to show some life and the bloated supply of unsold inventory to thin.[7] Housing starts in March dropped to a 17-year low, an indication that the national new-home market has a long way to go before it hits bottom.[3]
Government says housing starts fell 11.9% in March, with permits also weaker than expected.[2] Starts fell 11.9% in March to a seasonally adjusted 947,000 annualized units weaker than the 988,000 pace expected by economists surveyed by MarketWatch. This is the lowest level of starts since March 1991.[5] WASHINGTON (MarketWatch) - New construction of U.S. houses plunged to the lowest level in 17 years in March, the Commerce Department estimated Wednesday.[5] The latest figures from the U.S. Commerce Department suggest the decline in housing activity is some way from bottoming out.[6]
Starts in the Northeast dropped 8.5 percent month-to-month, the Commerce Department reported.[3]
Starts were projected to fall 5.2 percent to a 1.01 million pace from an originally reported 1.065 million rate in February, according to the median forecast in a Bloomberg survey of 72 economists.[4] A separate report today showed that consumer prices rose 0.3 percent in March from the previous month, matching economists' forecasts.[4]
"Many are simply unable to qualify for financing given the more restrictive lending environment.'' Economists surveyed by Bloomberg this month forecast the economy will not grow at all in the first half of the year, the weakest performance since the 2001 downturn.[4] Foreclosures are pushing down property values by adding to the glut of unsold homes, prompting buyers to hold out for better bargains and undermining new construction. The Federal Reserve will probably lower the benchmark rate again at its meeting this month to cushion the economy against the housing- led slowdown. "Home construction is probably going to continue to fall right through this year,'' Mark Vitner, a senior economist at Wachovia Corp. in Charlotte, North Carolina, said in a Bloomberg Television interview.[4] The wait for a kick start for new construction may be a long way off as foreclosures continue to boost inventories, weaken prices and thereby provide another lift in foreclosures as home values fall below mortgage principle owed.[7]
NEW YORK (CNNMoney.com) -- Initial construction of U.S. homes fell to a 17-year low in March, a much steeper-than-expected drop, according to a government report released Wednesday.[2] Starts of new single-family homes fell by 5.7% to 680,000 in March, while starts of large apartment units fell 24.6% to 267,000.[5]
The ongoing decline in new home construction is a necessary step toward reestablishing balance in the market, Larson said. "As painful as these numbers are in the short term they are exactly what we need for long-term growth," he said. [2] The construction slump is causing job losses to mount and sales of building materials and appliances to drop. Falling home prices undermine consumer confidence and spending, which accounts for two-thirds of the economy.[4] Building permits, a gauge of future construction, fell to a 927,000 rate from 984,000 the prior month.[4]
The number of housing starts hit an annual rate of 947,000 units last month, down from 1.075 million in February.[6] Economists were expecting housing starts to decline to 1.01 million, according to consensus estimates compiled by Briefing.com. "These figures confirm that the housing market is still groping for a bottom," said Mike Larson, a real estate analyst for research firm Weiss Research.[2]
All times are ET. : Time reflects local markets trading time. - Intraday data delayed 15 minutes for Nasdaq, and 20 minutes for other exchanges. Disclaimer [2] MarketWatch, the MarketWatch logo, and BigCharts are registered trademarks of MarketWatch, Inc. Intraday data delayed 15 minutes for Nasdaq, and 20 minutes for other exchanges.[2]
Dow Jones Indexes(SM) from Dow Jones & Company, Inc. SEHK intraday data is provided by Comstock and is at least 60-minutes delayed.[5] Intraday data provided by Interactive Data Real Time Services, a division of Interactive Data Corp. and subject to terms of use.[5] Historical and current end-of-day data provided by Interactive Data Pricing and Reference Data. More information on NASDAQ traded symbols and their current financial status.[5]
Consumer confidence, meanwhile, has fallen to lows not seen since the early 1980s. Other economic data published on Wednesday showed that consumer price inflation rose by a modest 0.3% in March on a monthly basis. [6]
SOURCES
1. US Housing starts fall below the 1 million starts per year in March - Forex News | IBT FX Center
2. New home construction declines in March to 17-year low - Apr. 16, 2008
3. March housing starts at 17-year low | Philadelphia Inquirer | 04/16/2008
4. Bloomberg.com: U.S.
5. U.S. March housing starts down 11.9% to 947,000 - MarketWatch
6. BBC NEWS | Business | US housing market ebbing further
7. Briefing.com: Housing Starts Plunge Nearly 12%
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