Wednesday, August 17, 2011

JULY HOUSING NUMBERS DROP 1.5%


Single-family home construction slowed in July from already-depressed levels as the housing sector showed few signs of coming back to life.

Housing starts fell 1.5 percent to a seasonally adjusted annual rate of 604,000 units, the Commerce Department said Tuesday in a report that was in line with estimates. The figure is about half what economists say is needed to sustain a healthy housing market and less then one-third of peak levels from the height of the housing boom in 2005-06.


There was little sign of near-term growth as applications for new building permits also fell 3.2 percent in the month.
"There is still no sign yet of a pickup in housing," said Patrick Newport, economist for IHS Global Insight. The weak employment market is delaying a revival in demand for housing he said in substantially downgrading the firm's forecast for housing activity this year.
"Pent-up demand for housing is building as young adults stay at home, and at some point will spark a major revival in housing activity," he said in a note. "But it is becoming harder to see that soon."
The report was in line with expectations of analysts, who saw a glimmer of hope in the multifamily segment as more Americans are renting rather than buying homes, spurring demand for new apartments.

Apartment building rose more than 6 percent. Single-family homes, which represent 70 percent of home construction, fell 5 percent.

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