Wednesday, October 18, 2006

Today’s New Construction Report

Continuing the consistent and ever worsening deterioration of the US housing market, today’s “New Residential Construction Report” provides additional evidence that residential real estate is experiencing a protracted decline.

Popularly reported as showing an "unexpected" 5.9% increase in housing starts from August’s revised figure, the report, if viewed more thoroughly, displays many, far more significant declines.

Particularly interesting is that this months report show that virtually every indicator is now recording high double digit year over year declines, with the West region breaking over 40% in declines to housing permits.

Here are the statistics outlined in today’s report:

Housing Permits

Nationally

  • Single family housing permits down 6.0% from August, down 32.1% as compared to September 2005
Regionally

  • For the Northeast, single family housing permits down 2% from August, down 31.9% as compared to September 2005.
  • For the West, single family housing permits down 4.9% from August, down 41.1% as compared to September 2005.
  • For the Midwest, single family housing permits down 3.4% from August, down 30.5% as compared to September 2005.
  • For the South, single family housing permits down 7.8% from August, down 27.5% compared to September 2005.
Housing Starts

Nationally

  • Single family housing starts up 4.3% from August, down 20.3% as compared to September 2005.
Regionally

  • For the Northeast, single family housing starts down 12.1% from August, down 29.7% as compared to September 2005.
  • For the West, single family housing starts up 0.9% from August, down 30.8% as compared to September 2005.
  • For the Midwest, single family housing starts up 3.9% from August, down 33.0% as compared to September 2005.
  • For the South, single family housing starts up 8.5% from July, down 8.4% as compared to September 2005.
Keep in mind that this particular report does NOT factor in the cancellations that have been widely reported to be occurring in new construction.

As further reports are released, cancellations should show an even greater effect on permitting, starts and completions.

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6 comments:

  1. The Financial Entertainment Network glossed over permits and focused on construction. We here recognize a going out of business sale as the the warehouses are emptied onto the sales floor.

    We plain old have way too many houses relative to the number of people who can afford them. The interesting thing is that even a massive price drop won't change that. We've already "pulled forward" several years' worth of new buyers with loose lending and frenzy. Permits tell us this.

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