Today’s New Residential Construction Report showed a continued pullback to both single family permits and starts suggesting that housing is continuing to retrench in the wake of the expiration of the government's housing tax credit gimmick.Single family housing permits, the most leading of indicators, dropped 1.2% on a month-to-month basis to 416K single family units (SAAR) or a notable 13.2% below the level seen in July 2009 and an astonishing 76.86% below the peak in September 2005.
With the substantial headwinds of rising unemployment, epic levels of foreclosure and delinquency, mounting bankruptcies, contracting consumer credit, and falling real wages, an overhang of inventory and still falling home prices, the environment for “organic” home sales remains weak and likely very fragile.
