Single-family housing starts fell 5.1% in April, yet another sign that the market for both new – and existing – homes continues to be anemic despite ultra low mortgages rates.
The decline in activity follows a 7% jump in starts during March.
The Census Bureau reported Tuesday morning that single-family housing starts fell to a 394,000 seasonally adjusted annual rate in April compared to a 415,000 rate the month prior.
The bureau also revised downward its start numbers for the first three months of the year by a total of 18,000 units.
Builders remain pessimistic on their immediate outlook for new home sales as they continue to face stiff competition from lower priced REO sales and tight credit conditions for construction loans.
At the same time, potential buyers are reluctant to sign a sales contract because of concerns about financing and their ability to sell their existing home, according to a National Association of Home Builders survey.
“Asked to identify reasons that potential customers are holding back at this time, 90 percent of builders surveyed said clients are concerned about being able to sell their existing home at a favorable price, while 73 percent said consumers think it will be difficult for them to get financing," said NAHB chief economist David Crowe.
