U.S. Housing Starts Fall

Posted by Jeff on March 17, 2010 under Real Estate | Be the First to Comment

U.S. housing starts fell about 5.9% to a seasonally adjusted annual rate of 575,000 in February as several massive snowstorms hit the East and South. New construction was down in the Northeast and South, but up in the Midwest and West.

Starts of single-family homes fell 0.6% to a 499,000 pace, while starts of large condos and apartment building plunged 43%. In the past year, starts of single-family homes are up 39%, while starts of multifamily units are down 41%. Building permits dropped 1.6% to 612,000 in February. Permits for single-family homes fell 0.2% to a 503,000 rate.

So is this good news or bad? Bad news for builders but good news for the housing market. There are way too many homes for sale and this housing market will not recover until we work off the existing supply. So why do we need more inventory?