Housing Starts Continued to Free Fall in December

Daily Forex Fundamentals | Written by Wachovia Corporation | Jan 22 09 14:30 GMT |

Starts of new homes dropped another 101K units in December, after falling a revised 126K in November. Single- and multi-family starts both saw large declines on the month. No corner of the market seems safe in this relentless downturn. Further declines may be possible through the winter. Starts Plunge Starts dropped another 15 percent in December after a similar drop the month before. Builders continued to pull back on activity at a torrid pace as the economy entered a second year of recession. With an unusually cold January, especially in the South, we are not looking for a bounce in next month's release. Permits Do Not Lend Much Hope for Coming Months Permits saw another 10 percent plus drop in December and were off a full fifty percent from the year before. In a separate release yesterday, the NAHB/Wells-Fargo home builders' sentiment index fell to another all-time low. We do not expect any significant improvement before spring as builders see little reason to start new homes in the current environment. Wachovia Corporation http://www.wachovia.com Disclaimer: The information and opinions herein are for general information use only. Wachovia Corporation and its affiliates, including Wachovia Bank, N.A., do not guarantee their accuracy or completeness, nor does Wachovia Corporation or any of its affiliates, including Wachovia Bank, N.A., assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. Such information and opinions are subject to change without notice, are for general information only and are not intended as an offer or solicitation with respect to the purchase or sales of any security or any foreign exchange transaction, or as personalized investment advice. Securities and foreign exchange transactions are not FDIC-insured, are not bank-guaranteed, and may lose value.