Posted on 03/18/2015 10:39:39 AM PDT by Lorianne
Groundbreakings on new homes dropped by a sharp 17% in February, the U.S. Commerce Department said Tuesday.
February’s housing starts fell to a seasonally adjusted, annual rate of 897,000, well below January’s estimate of 1.081 million, though only 3.3% below the pace in February 2014. The numbers missed–by a long shot–the 1.048 million starts economists surveyed by Bloomberg had forecast ahead of the release.
Perhaps it’s not surprising, then, that builder confidence in the market for newly constructed, single-family homes dropped by two points in March to a level of 53, according to the latest National Association of Home Builders/Wells Fargo WFC -0.54% Housing Market Index, released Monday. A reading of 50 or higher means that more builders rate conditions are good than poor, and the measure has now hit that mark for nine consecutive months.
“The drop in builder confidence is largely attributable to supply chain issues, such as lot and labor shortages as well as tight underwriting standards,” said David Crowe, NAHB’s chief economist. “These obstacles notwithstanding, we are expecting solid gains in the housing market this year, buoyed by sustained job growth, low mortgage interest rates and pent-up demand.”
Underscoring Crowe’s optimism, the number of building permits issued in February was actually up 3% from January to a (seasonally adjusted, annual) rate of 1.092 million, thanks to a strong surge in permitting for multi-family units. While single-family permits stood at 620,000 in February (6.2% below January), buildings with five units or more hit a permit rate of 445,000 in February (19.9% above January’s numbers). Overall, February’s permitting level was 7.7% above the pace one year earlier.
(Excerpt) Read more at forbes.com ...
Pent-up demand among people working 20 & 30 hours a week doesn't translate into actual purchases.
I just don't believe anyone anymore.
You forgot to use the word ‘unexpectedly.’
I meant to add that more subprime mortgages are no a positive thing.
” Pent-up demand among people working 20 & 30 hours a week doesn’t translate into actual purchases.”
WINNER
Bad weather, too much global warming, people decoded not to shop. Yada Yada,Yada. Housing has been in the dumps for a half decade. There is no sign that new housing will rebound to pre-recession levels anytime soon.
Too many young people are Baristas instead of Business People. Too many’children’ are on their mommy’e health insurance at 26 to actually go out buy a starter home. Way too many ‘young adults’ spend their days in mommy’s basement playing World of War than go to a job that leads to a career. Way too many college graduates are suffering with six figure debt for degrees that will allow them a low five figure salary.
Also too many middle thirty and forty year old people are underwater on their ‘starter home’ to make the move to a larger home in the hinterlands.
FROZEN ground is hard to break.
exactly
Nailed it
Less than 625,000 single family homes had building permits drawn last month the remaining where multi-family (Apartments, Condo?, and GOVERNMENT HOUSING).
Renters do not spur economic activity at near the rate as buyers. They do not generally buy a great deal of household items that one would call durable goods. High end washers, dryers, refrigerators, etc... Rental units carry the least quality items available to meat the demand of a renter, who by definition is less stable economically.
I have seen building construction start in mid February in Minneapolis when the demand is there. Excavation and foundation digging can be done in almost any weather. The Cold and snow has little effect on large excavators.
These are seasonably adjusted numbers. Meaning they are manipulated to look better than they actually are.
A backhoe has no problem digging up several inches of concrete, It has less issues with several inches of frozen ground. The only thing that isn’t done in very cold weather is new site concrete pours. That doesn’t stop new starts.
The weather might actually be an excuse this time. February was friggin COLD! And it never quit snowing.
Not really, permit applications were also down. Also in most of the country building in February is not a problem.
Best economy eva...
Weather was exceptionally unfavorable in the East in February - can’t lay concrete when it is too cold.
If it was a weather-related delay, we should see a rebound effect in March
Is this year over year? That’s all that really matters regarding this number.
A friend is selling her home for 30k less then it was worth 10 years ago. If it sells.
It’s all that Global Warm....
.. I mean CLIMATE CHANGE!
Going into the Summer of Recovery Part VII.
only 3.3% below the pace in February 2014
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