New home permits rise, but headwinds persist

New home permits increase 2.5 percent, but remain below levels of a year ago. New home permits are down nearly 80 percent from their 2005 peak.

By , Guest blogger

  • close
    New home permits for single-family homes rose 2.5 percent, which was more than expected.
    View Caption

Today’s New Residential Construction Report showed slight increases to both single family permits and starts from last month and notable declines from last year while the new home market remains historically distressed.

Single family housing permits, the most leading of indicators, increased 2.5% on a month-to-month basis to 405K single family units (SAAR), dropping a notable 6.90% below the level seen in May 2010 and an astonishing 77.47% below the peak in September 2005.

Single family housing starts increased 3.7% to 419K units (SAAR), dropping 8.91% below the level seen in May 2010 and a stunning 77.02% below the peak set in early 2006.

Recommended: Could you pass a US citizenship test?

With the substantial headwinds of elevated unemployment, epic levels of foreclosure and delinquency, mounting bankruptcies, contracting consumer credit, and falling real wages, an overhang of inventory and still falling home prices, the environment for “organic” home sales remains weak and likely very fragile.

Add/view comments on this post.

--------------------------

The Christian Science Monitor has assembled a diverse group of the best economy-related bloggers out there. Our guest bloggers are not employed or directed by the Monitor and the views expressed are the bloggers' own, as is responsibility for the content of their blogs. To contact us about a blogger, click here. To add or view a comment on a guest blog, please go to the blogger's own site by clicking on the link above.

Share this story:

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...