Housing Data

November 23, 2006

Comments

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.

2 responses to “Housing Data”

bains

November 23, 2006 at 10:16 pm

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

November 25, 2006 at 2:21 pm

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.