Posted on 10/17/2007 5:55:40 AM PDT by Hydroshock
Edited on 10/17/2007 6:01:29 AM PDT by Admin Moderator. [history]
NEW YORK (CNNMoney.com) -- Builders continued to slam the brakes on new homes in September, as the government's latest reading on the battered market out Wednesday showed housing starts and permits were weaker than expected at levels not seen for more than a decade.
The pace of housing starts plunged 10 percent to an annual pace of 1.19 million from a 1.33 million rate in August. That was the weakest level in just over 14 years. Economists surveyed by Briefing.com had forecast that starts would fall to an a rate of 1.29 million.
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Fortune's Andy Serwer talks with former Fed Chairman Alan Greenspan about the credit crunch and what it means for the housing market. Play video
Housing permits, which are seen as a sign of builders' confidence in the market, slumped 7 percent to an annual rate of 1.23 million from 1.32 million in August. It was the lowest level of permits in more than 12 years. Economists had looked for permits to slow to a 1.3 million pace.
The report follows a survey released Tuesday that showed home builders' confidence in the battered market for new homes fell to an all-time low in October, and a measure of their outlook for six months down the road remained at a record low level, according to the latest industry survey.
The downturn in housing and demand for new homes has hammered the results of the nation's top builders. Leading home builder D.R. Horton (Charts, Fortune 500) reported Tuesday that its fiscal fourth-quarter orders fell 39 percent, while the value of those orders plunged 48 percent.
Except in certain areas.
My local building department has not issued a permit in six months because they cannot figure out how to comply with flood regulations. There are three renovation projects waiting to go forward on my block, and nobody can get a permit. This problem is occuring in towns all over the county.
That’s usually what happens when supply outpaces demand..............
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We're doomed
Brother can you spare a dime?
People who couldn’t afford buying these homes in the first place will go back to renting, the banks and mortgage co’s, and builders will take the hits, and housing appreciation will return to the historical averages. Not exactly a Great Depression scenario.
I’ve been looking for a place. The prices are falling. I have had my eye on one little farm, and the price has gone down $70,000 in the last three months. Now I just have to figure out where the bottom is.
Take your Sunday paper. Count all the real estate ads. when the next Sunday’s paper has fewer ads, that’s when the bottom has been found...............
Brother can you spare a dime?.....with inflation and all, that would now require a buck at least..........
Good tip. I will have to subscribe to the local paper there. I know that right now the number of ads is way up. It seems like the whole county is for sale.
That stupid picture’s not part of the original article. Why did you add it in such a way as to make it appear as though it were?
If you like the farm, and you like the price, buy it now. There’s probably a few other folks out there that like that farm, too.
Oh, just let him enjoy his Great Depression....
Yes, all housing markets are local. And the price range matters. There are over 100,000 houses listed for sale in the Atlanta MLS. However, the son-in-law of a fellow churchgoer just started 100 “starter” houses in Cobb County, in the $250K range I recall, and can’t build them fast enough to meet the demand. If you don’t build what the market is demanding (including price-point and features), you can be stuck with alot of unsold inventory. An acquaintance of mine who is a builder in an adjacent bedroom county is saddled with three nicely built houses that he hasn’t been able to sell at a profit because they don’t have basements. Suddenly, that’s what everyone wanted and expected in the $350K price range.
“The sky is falling, the sky is falling” — but only on that overpriced highly leveraged real estate. Let them take their lumps.
I did not put it there.
Really? Then I apologize.
Since the suppliers of housing are adapting to an over-supplied housing market quicker than forecast, it follows that the market will return to normal quicker than forecast.
Thanks for that good news.
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