Home Construction on the Slow Road to Recovery

posted on October 24th, 2011 filed under: Real Estate Market Data

It told you there was a boom, it warned you of the bust, and now it’s telling you that this is one slooooow recovery.

Housing Starts -- Chart -- Jan 1990 to Sept 2011

The little uptick in the data for September 2011 is as much dark cloud as silver lining.  All of the gain came from construction of multifamily (5 or more units) buildings.  Nevertheless, the data set overall appears to show a durable bottom in place.

Another positive note is that the NAHB/Wells Fargo Housing Market Index (commonly known as the homebuilder sentiment index) jumped to 18 from 14.  Like housing starts data, HMI told you there was a boom and warned you of the bust.  A reading of 18 is still quite negative (below 50 is considered pessimistic), but it’s a significant step back from the edge.  The low back in spring 2009 was in the single digits.

Slowly better is better than worse.

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posted by // This entry was posted on Monday, October 24th, 2011 at 8:01 am and is filed under Real Estate Market Data. You can follow any responses to this entry through the RSS 2.0 feed.

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