Posted on 05/16/2012 9:57:55 PM PDT by iowamark
I just about knew it when I heard a top-of-hour radio report this morning. When the announcer intoned that there was a 3% increase in "home construction" in April, I said to myself: "There's the Associated Press again, up to its old tricks." That was indeed the case. When I went to the related AP reports, I found that they were, like the economic data coming out during the Obama administration, much worse than expected.
In this morning's coverage of the still bottom-feeding situation in new home construction, the AP's Christopher Rugaber indeed wrote that a 3% seasonally adjusted April increase in housing starts from an annualized 699,000 to 717,000 represented an improvement in "the rate of construction." But he was just warming up. In an afternoon report which can only be characterized both in tone and in detail as an attempt to blow smoke up the public's posterior, he falsely claimed that "Home construction is near a three-year high." I would call that assertion "horse manure," but that would be unfair to equine excrement.
Sorry, Chris -- and Derek Kravitz, Marty Crutsinger, Paul Wiseman, and the rest of those at the alleged and self-described "Essential Global News Network." The statistic known as "housing starts" is not the same thing as "home construction." Never has been. Never will be. In this case, as will be shown, pretending that they are the same has massively deceived readers, listeners and viewers of AP-generated content.
It is insultingly obvious that for "home construction" to be near a three-year high, builders at the very least must be working on almost as many homes now as they were three years ago. But they aren't, and it's not even close. The charts the Census Bureau updates every month in its housing release in the category known as (of all things) "Housing Units Under Construction" (total; single-family) -- items reporters at outfits like the Associated Press should be looking at before they hit the "send" key on their dispatches -- say so:
In fact, comparing the red April 2012 boxes to the green April 2009 boxes, the number of seasonally adjusted total units under construction is down over 32% (a 220,000-unit drop divided by 677,000). Seasonally adjusted single-family units under construction are down 25% (a 83,000-unit drop divided by 327,000). The drop in the not seasonally adjusted results in each case are virtually identical to their seasonally adjusted counterparts. In the past three years, the number of multi-unit dwellings under construction, the difference between the total and single family figures, has fallen 40% on a seasonally adjusted basis, while the raw number is down by 37%.
Allso note that the number of single-family units under construction has actually fallen in the past 12 months. The entire overall increase of 10% in the overall seasonally adjusted number during that time (from 416,000 to 457,000) is due to a 27% increase in the number of multi-unit dwellings in process.
No one can possibly look at the above data and really believe that "home construction is at a three-year high." Overall, the number of units being built is barely above its all-time low. Single-family units are still stuck there.
Readers will also search in vain in the seasonally adjusted figures for a figure supporting Rugaber's other claim that April saw a 3% increase in the "rate of construction" compared to March.
The three-year time frame above represents a pretty good metric by which to measure the Obama administration's performance. After all, its early-2009 home assistance measures and the vaunted stimulus plan enacted in February of that year were supposed to help the housing industry recover and jump start the economy, respectively. Uh, not exactly.
Rugaber used his contrived three-year high as part of the basis for a theorizing in his later report that "Maybe the U.S. economy's strength this winter wasn't just weather-related after all." Spare us, Chris.
Rugaber's reports are the kind you would expect a news organization seeing the above data to withdraw. Readers here know that's not going to happen. After all, we're dealing with the Administration's Press.
There's still a glut of foreclosures, so no need to build new homes in a lot of places.
That would be "fiat", Latin for "let it be done", meaning a DECREE ( Webster's Collegiate )
But no big deal! I agree with your sentiments entirely.
I respectfully disagree with this article. New home construction bottomed out in the fall of 2011. Then something happened that I knew would, and was waiting for: long dormant tracts of abandoned development plots started getting snapped up by new builders for pennies on the dollar. Within a few weeks frameworks started springing up in fields that had lain fallow for years. Thanks in part to the fire sale price of the land, new homes could compete with (and in many cases beat) the prices of foreclosures and short sales. It became time to buy.
I signed on to a new home last November, and closed 4 months later the day after it was finished. During that time from empty lot to final walkthrough it appreciated $20,000. The builder can’t build them fast enough, and is now turning away buyers until the crews can catch up. Nearly every empty lot in the future phases is sporting a ‘Sold’ sign already.
Feel free to deny it if you want. Personally, I’m content in the knowledge that I caught this cycle at the perfect time.
I need to move and I’ll be lucky to get what I paid for this house 7 years ago. Heck, I’ll be lucky to get $10,000 less than that which is what I need at a bare minimum just to pay the lien off.
7 years ago, there were 4 houses for sale in this town in this price range, now there are at least 2 dozen. Houses were getting snatched up quickly back then but now it seems like there is hardly any interest and mucho selection. A buyer’s market.
It doesn’t look good for me and I’m in one of the better markets. As a matter of fact, the Realtor’s association rated this market number one a few years ago and that was after the financial meltdown of 2008.
“The builder can’t build them fast enough”
It really varies state to state. I hear Colorado is having a housing boom and doesn’t have enough skilled carpenters, etc.
What about commie states like California and Illinois?
As a statistical measurement, stories such as yours are less than worthless.
“Within a few weeks frameworks started springing up in fields that had lain fallow for years.”
I’d imagine you are describing an area where there is not yet a local community of permanent dependents with their hands out to the working taxpayers for housing, food, etc.
That probably explains it; in the developed areas of this country people can’t get rid of their homes (and the huge costs associated with them due to the aforementioned) fast enough.
You are describing the situation in my area; anyone selling a home is competing with several others within blocks that are for sale by banks or desperate owners, and it is driving prices downwards. Because property taxes are so high ($7K+) there are few takers anyway; those that sell are often rapidly converted into illegal 2 families just to come up with the property taxes.
At this point homes in northern NJ are hot potatoes due to those property taxes; the municipalities just want anyone in there paying taxes to feed the public school industry, and the costs associated with it guarantee that there really are no other services. The roads are crap, “Stop” signs are obscured by overhanging branches, police and fire have been cut (which would be a good thing if it resulted in savings, but the funds have just been re-directed to the teachers’ unions with their more powerful lobbying)...it is a mess.
Point out Obama’s foreign birth, Islamic identity, or criminal associations and get called racist. Point out the malfeasance of any partisan media shill and be tarred as being against the press. Thanks iowamark
Your city sounds somewhat similar to mine. They dropped almost every speed limit to 20 and the cops are issuing tickets like madmen... and I live in ‘Conservative’ state.
We’ve always had ticketing (mostly by street cleaners driving around without even lowering their brushes), and I think merchants have really pushed to avoid raising revenues that way - it hurts them, and that reputation is hard to shake. We have too many towns on top of each other, and any with a ticketing campaign quickly watches the consumers drive a mile in any direction to shop in a neighboring town.
“I signed on to a new home last November, and closed 4 months later the day after it was finished. During that time from empty lot to final walkthrough it appreciated $20,000”
Typical developer sales tactic for the first few homes in a new subdivision. Make the price attractive to create the illusion there’s a demand then once building activity is underway jack up the price for the next round of buyers and keep it up until buyer price resistance is met.
The current property taxes on the 1200 square foot split level my parents owned for a couple of years in a modest tract neighborhood during their internment to NJ in the early 60’s is within a couple of hundred dollars of being $10K/year.
These people have no shame and there are so many lies where would Romney start. No wait,
Romney will not sttack Obama in the name of McCain's standards.
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