Today’s New Residential Construction Report showed a slight bounce off of last months exceptionally weak results with both single family permits and single family starts which rising while the new home market remains historically distressed.Single family housing permits, the most leading of indicators, increased 5.7% on a month-to-month basis to 405K single family units (SAAR), dropping a notable 25.3% below the level seen in March 2010 and an astonishing 77.47% below the peak in September 2005.
Single family housing starts increased 7.7% to 422K units (SAAR), dropping a notable 21.1% below the level seen in March 2010 and a whopping 76.85% below the peak set in early 2006.
With the substantial headwinds of elevated 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.
