Housing starts dip 5 percent in July

Housing starts dropped to 425,000 units, while permits to build single family homes stayed flat. The number of housing starts in July is about 1 percent lower than a year ago.

This chart shows about 11 years of single family housing permits. The number of permits stayed about the same from June to July 2011 and remains about 78 percent below the peak seen in September 2005. Housing starts are about 77 percent lower than the peak in early 2006.

Today’s New Residential Construction Report showed that single family permits went flat while single family housing starts declined notably from last month with both measures continuing to show sight year-over-year declines.

Single family housing permits, the most leading of indicators, remained flat from last month at 404K single family units (SAAR), dropping 1.22% below the level seen in July 2010 and an astonishing 77.53% below the peak in September 2005.

Single family housing starts declined 4.9% to 425K units (SAAR), dropping 0.93% below the level seen in July 2010 and a stunning 76.69% below the peak set in early 2006.

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.

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