U.S. housing starts rise 2.3% in August

September 19, 2012 by · Leave a Comment
Filed under: Real Estate News 

Here is one of statistics mentioned yesterday.  The Commerce Departments release these and revised July slightly down.  The comment I like is that this is “another step forward in a long staircase”.  There is a good chance we have hit bottom in the real estate market for now.  The bigger question is can we actually have gains without the massive government support to keep interest rates so low that most projects “pencil” with the banks as long as you have your down payment?  At this point I would say no.  We have not demonstrated we can support a self-sustaining real estate market.

We likely have around 15% unemployment when you count people who have given up or are working part-time.  We need to figure out how we get these people to work and at the same time, deal with our deficit spending problem.   If we do all of those, then we may have a real recovery.   A long hard road ahead of us, I know we have it in us to make the tough choices, we just need to believe we do.

Reuters – The Commerce Department said on Wednesday housing starts increased 2.3 percent to a seasonally adjusted annual rate of 750,000 units. July’s starts were revised to show a 733,000-unit pace instead of the previously reported 746,000.

Economists polled by Reuters had forecast residential construction rising to a 765,000-unit rate. Compared to August last year, residential construction was up 29.1 percent.

“Another step forward on a very long staircase,” said John Tashjian, Principal, Centurion Real Estate Partners in New York.

“We continue to see positive signs emerging from the housing market, suggesting that the entire market, not just individual submarkets, are stabilizing and steadying themselves for future growth.”

Treasury debt prices rose slightly after the report. Stock index futures held their gains, while the dollar was little changed.

Housing starts are now a third of their 2.27 million-unit peak in January 2006. The housing market, the Achilles heel of the recovery from the 2007-09 recession, is slowly healing.

Sales have been creeping up and the house price decline has bottomed, with a tightening supply of properties on the market raising prices in some metropolitan areas. In addition, home-builder sentiment touched a six-year high in September.

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