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U.S. Housing Starts Fell in December to One-Year Low

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Builders began work on fewer homes than projected in December, a sign the industry that triggered the recession continued to struggle more than a year into the U.S. economic recovery. Housing starts fell 4.3 percent to a 529,000 annual rate, the lowest level since October 2009, Commerce Department figures showed today in Washington. The median forecast in a Bloomberg News survey called for a 550,000 rate. A jump in building permits, a proxy for future construction, may reflect attempts to get approval before changes in building codes took effect at the beginning of this year. Companies like KB Homes and Lennar Corp. project demand will be slow to rebound as elevated unemployment and mounting foreclosures discourage buyers. While low borrowing costs and falling prices are helping revive sales from last year’s post tax-credit slump, Federal Reserve policy makers are concerned housing may undermine the economic expansion. “With sales still near record lows and a lot of unsold properties in the market, there’s very little reason for builders to add more homes to the supply,” said Sal Guatieri, a senior economist at BMO Capital Markets in Toronto, who had forecast starts would drop to a 527,000 rate. “Housing remains a key downside risk to the economy.”

1 Comments in Response to

Comment by Happy Landings
Entered on:

Really? KB, Lennar and outfits like Pulte aren't proving to be good business models? What could have possibly gone wrong with pumping out overpriced cookie-cutter houses designed to lure in the working and middle classes and which will all look like crap in 10 years?

Well the good news is for photographers who dream of the shot of the snowy desertscape. It's gonna be covered with styrafoam beads. Tinker toys have more longevity.

I haven't seen the work of more than 6 decent finish carpenters in this whole state. 1/2" caulk should be sold as a specialty product. The cabinetry is crap, the fixtures are crap and I REALLY LOVE that trick of ending a door-jamb 3" off the floor. And I've only seen ONE taper. Like a guy who doesn't slap on first coat and cover for all this sins with crappily applied texture. And thanks to the divinely inspired technique of running water lines up to a house, then bringing them above grade for a few feet before running them into the exterior, half the state has broken water lines due to freezing now. You can pay in AZ plumber to do this for $65/hour or you can just lay out a garden hose on the ground to the same effect.

Just wait 10 years and all these gated communities are gonna look worse than South Central LA. I'd say "Haiti" is the look of the future.


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