Single-Family Starts Drop 5.6%

Single-family housing starts fell 5.6% in April and a monthly survey showed builders are taking an increasingly negative view of market conditions.The U.S. Census Bureau reported that SF starts dropped from a record seasonally adjusted annual rate of 1.63 million in March to 1.54 million in April -- the lowest level since November 2004. A May survey by the National Association of Home Builders found that more builders view sales conditions as poor rather than good and the NAHB/Wells Fargo Housing Market Index hit 45 -- its lowest reading since mid-1995. "Based on historical experience, particularly the 1994-1995 episode, the pattern of movement in the HMI is not inconsistent with the orderly cooling-down process we're projecting for home sales and single-family housing starts in 2006," NAHB chief economist David Seiders said. NAHB economists are predicting a 12% decline in home sales and a 7% decline in SF starts.