Housing Starts Decline in October
Nationwide housing production fell 10.6% to a seasonally adjusted annual rate of 529,000 units in October as builders awaited word on whether the home buyer tax credit would be extended, according to data released on Nov. 18 by the U.S. Commerce Department.
“As of October, the deadline for starting a home that could be completed in time for purchasers to take advantage of the $8,000 first-time home buyer tax credit had come and gone, and builders had no clear sign of whether Congress would extend the credit beyond the end of November,” explained Joe Robson, chairman of NAHB.
“However,” he said, “now that Congress has wisely moved to extend the tax credit into next year and expand its eligibility to more buyers, we hope and expect that this will have a substantially stimulative effect on home sales and help keep the housing market solidly on the road to recovery.”
“Builders were clearly in a holding pattern in October as the future of the home buyer tax credit hung in the balance,” agreed NAHB Chief Economist David Crowe. “This is not surprising, given the fact that the tax credit had been the primary driver of construction and sales in the summer and early fall. However, the fact that permits for single-family construction remained roughly unchanged in the month is an indication that builders are preparing for the possibility of more favorable housing market conditions in the future. That said, significant challenges continue to confront builders with regard to obtaining financing for viable projects and appropriate appraisal values on newly built homes.”
Single-family housing starts declined 6.8% in October to a seasonally adjusted annual rate of 476,000 units, the slowest pace since May of this year. Meanwhile, multifamily housing starts fell by a dramatic 34.6% to a seasonally adjusted annual rate of just 53,000 units — the slowest pace on record.
Regionally, total starts activity fell across the board in October, with declines of 18.8% in the Northeast, 10.6% in the Midwest, 9.6% in the South and 8.5% in the West.
Permit issuance, which can be an indicator of future building activity, fell 4% overall in October to a seasonally adjusted annual rate of 552,000 units, due primarily to a double-digit drop-off on the multifamily side. While single-family permits held virtually flat at 451,000 units, multifamily permits declined nearly 18% to 101,000 units.
Regionally, permit activity was mixed, with the Northeast posting no change for the month, the Midwest registering a 2% gain, and the South and West dropping off 5.8% and 6.7%, respectively.
Web Site One-Stop Shop for Tax Credit Info
Builders and other industry professionals can help spur home sales by referring prospective home buyers to www.federalhousingtaxcredit.com. The NAHB Web site provides detailed information on both the extended $8,000 first-time home buyer tax credit and the new $6,500 repeat buyer tax credit recently signed into law by President Obama.
Consumers can use the Web site to find information on both tax credits — including frequently asked questions and links to social media sites that provide updated information as it becomes available. It also includes a number of home-buying resources for consumers.
Industry professionals are encouraged to highlight the tax credit Web site when marketing to their potential home buyer market.
Webcast of Fall Construction Forecast Conference Now Available
An on-demand webcast of the 2009 Fall Construction Forecast Conference held at the National Housing Center in Washington, D.C., on Oct. 21 is now available for purchase.
The webcast fee includes access to the webcast archive and electronic copies of the conference handout and presentation materials. Multiple viewers in one office can purchase the webcast for one fee.
The on-demand webcast also gives viewers complete flexibility in their viewing experience — pause, skip forward and backward, or jump directly to your topics of interest. The webcast is available for $250.
To view the webcast schedule, topics of discussion and a list of the presenters, click here.
To purchase and download the webcast, click here.
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