Home Building Activity Declines

Single-family housing starts fell 7.3% in October as problems in the mortgage and housing markets make it difficult for builders to work down large inventories of newly constructed houses.The U.S. Census Bureau reported that single-family housing starts declined from a seasonally adjusted annual rate of 954,000 in September to 884,000 in October. SF starts are down 25% from October 2006 and 34% from October 2005. The National Association of Home Builders/Wells House Market Index shows that builders' sales expectations are at the lowest level since the index was started in 1985. NAHB president Brian Catalde said many builders are reporting that special sales incentives are having "limited success" in attracting buyers. Meanwhile, NAHB chief economist David Seiders does not see a bottom in housing starts until mid-2008. Builders realize it will be "some time before market conditions support an upswing in building activities," he said. The Census Bureau also reported that multifamily starts rebounded 47% in October to 312,000 units.