Property Crossroads - Real Estate Info

Dim new-construction numbers should be no surprise

by Dan on October 18th, 2007

There’s no shortage of places to look for bad news regarding the residential housing industry. The newest shot of it comes from the National Association of Home Builders.

Yesterday, the association released the news that housing starts across the nation declined 10.2 percent in September. The reason, according to the association, is that builders have decided to reduce their inventories as the mortgage market continues its struggles. The builders association data, by the way, is to be trusted; It comes from the U.S. Commerce Department.

The numbers shouldn’t surprise anyone, either. The residential real estate slump is hurting everyone in the business. The builders of new homes are far from immune.

Homebuilders are now on pace to build 1.19 million units of new residential properties in 2007. That is the lowest amount of new residential construction since March of 1993.

David Seiders, the builders association’s chief economist, said he expects more declines in new construction heading into next year. New construction should finally rise again in the second quarter of next year, he added.

Building permits fell in September, too, according to the homebuilders. Single-family permits fell 7.1 percent, while multifamily ones dipped 7.7 percent.

Activity wasn’t sluggish in every part of the country, though. In the Northeast United States, housing starts posted a 45.4 percent gain in September. The Midwest saw the biggest decline in housing activity, with starts dropping 28.4 percent. In the South, starts dipped 11.7 percent, while in the West they declined 10.1 percent. 

Share This

Related Stories

• Fannie Mae write-offs tops in Michigan, Ohio
• Women still struggling to make gains in construction
• Renting in New York City? Ouch
• Living above it all in New York City
• Foreclosures dip in November

POSTED IN: Breaking News, Buying a Property, Insights and Commentaries, Mortgage, Real Estate Tools, Road to Profits, Selling a Property