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.