Today’s New Residential Construction Report showed a slight gain to single family permits and notable decline single family starts which, along with a series of downward revisions to prior months results, suggest that housing is continuing to remain weak in the wake of the expiration of the government's housing tax credit gimmick.Single family housing permits, the most leading of indicators, increased 1.0% on a month-to-month basis to 406K single family units (SAAR) but declined a notable 13.2% below the level seen in October 2009 and an astonishing 77.42% below the peak in September 2005.
Single family housing starts slumped 1.1% to 436K (SAAR) units dropping 8.2% below the level seen in October 2009 and a whopping 76.08% below the peak set in early 2006.
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.
