Today’s New Residential Construction Report showed that in August, single family permits increased while single family starts declined notably from July with both measures continuing to show tepid results when compared on a year-over-year basis.
Single family housing permits, the most leading of indicators, increased 2.5% from last month to 413K single family units (SAAR), increasing a slight 1.98% above the level seen in August 2010 but remaining an astonishing 77.03% below the peak in September 2005.
Single family housing starts declined 1.4% to 417K units (SAAR), dropping 2.34% below the level seen in August 2010 and a stunning 77.13% 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.
