Today’s New Residential Construction Report showed a gain to both single family permits and single family starts which, considering the truly depressed level of new home construction activity, appears to suggest that housing is continuing to remain historically weak.Single family housing permits, the most leading of indicators, increased 3.0% on a month-to-month basis to 416K single family units (SAAR) but declined a notable 14.9% below the level seen in November 2009 and an astonishing 76.86% below the peak in September 2005.
Single family housing starts increased 6.9% to 465K (SAAR) units dropping 7.7% below the level seen in November 2009 and a whopping 74.49% 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.
