December 08 Housing Starts Plummet

Single-family housing starts plummeted 13.5% in December from November as a dismal year for builders came to a close in which construction dropped off by nearly 50% from a year ago. The U.S. Census Bureau reported that single-family housing starts declined from a seasonally adjusted annual rate of 460,000 in November to 398,000 in December. The bureau revised November starts upward from 441,000. Construction of new homes fell to 622,400 in 2008 from 1.05 million in 2007 or 48.9%. Total starts were way down as well, off 45% to 550,000. The National Association of Home Builders is forecasting that single-family starts will fall another 26% in 2009. "Clearly, conditions in the nation's housing market aren't getting any better, and they aren't going to get any better until the federal government takes substantial action to encourage qualified buyers to get back in the market," NAHB chairman Sandy Dunn said. The builders are urging Congress to approve an interest rate buy-down program along with more generous homebuyer tax credits.