SF Housing Starts Plunge

Single-family housing starts plunged 13.7% in February, and the red-hot housing market may be settling down to a lower level of activity.The U.S. Census Bureau reported that single-family starts fell from a seasonally adjusted annual rate of 1.501 million in January to 1.295 million in February. Single-family permits fell by 6.8%. The drop in starts follows a report several weeks ago that new home sales fell 15.1% in January. Economists with the National Association of Home Builders knew the December and January housing start numbers were not sustainable. "Some correction was due, but this is larger than we anticipated," NAHB economist Michael Carliner said. Weather and concerns about war with Iraq may have contributed to the sharp decline in starts. But the NAHB economist said it is unclear whether it is a sign of a larger problem with the economy. "I won’t dismiss this as just a fluke or special factors that are all going to disappear next month," he said.