Housing Data

In case you missed it, Prof. Hamilton has a post up looking at the data on housing starts and permits and the news isn’t good. After rebounding 4.9% in September housing starts dropped 14.6% last month meaning that compared to October 2005 housing starts are down 27%.

Housing permits have basically been trending down sharply and compared to October of last year are down 28% over all. Last month, private housing permits were down 6.3%.

Overall, it doesn’t look like the housing market is going to stabilize soon. I suppose some good news on interest rates could change this, but overall there is cause for concern.

FILED UNDER: Economics and Business
Steve Verdon
About Steve Verdon
Steve has a B.A. in Economics from the University of California, Los Angeles and attended graduate school at The George Washington University, leaving school shortly before staring work on his dissertation when his first child was born. He works in the energy industry and prior to that worked at the Bureau of Labor Statistics in the Division of Price Index and Number Research. He joined the staff at OTB in November 2004.

Comments

  1. bains says:

    Is the sky falling? Or perhaps just a market correction? Not to say that loads of folks wont be adversley affected, but…

  2. Steve Verdon says:

    According to Ed Leamer, head of the Anderson School Forecasting group notes that most recessions have their start with a housing market down turn. It isn’t 100%, but still being concerned with this downturn is very reasonable, IMO.

    Also this expansion is “old” already, and most think growth in the next year will be lower than in the past few years. Add on top of that at turning points in the economy forecasters usually miss the turn. No falling sky, but an economy that is showing signs of weakness, and possibly–although unlikely–a recession.