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Posted by symphony on August 19, 2008, 1:15 am
> Housing Starts Probably Slumped in July: U.S. Economy Preview
>
> Aug. 17 (Bloomberg) -- U.S. builders began work in July on the fewest
> houses in 17 years and the economic outlook dimmed, indicating the
> real-estate slump is at the epicenter of the growth slowdown,
> economists said before reports this week.
>
> Housing starts plunged 9.9 percent to an annual rate of 960,000,
> according to the median estimate in a Bloomberg News survey ahead of a
> Commerce Department report on Aug. 19. The Conference Board's index of
> leading indicators probably fell 0.2 percent last month, a third
> consecutive drop.
>
> Stricter lending rules, rising borrowing costs, falling property
> values and record foreclosures may further depress home sales and
> cause builders to keep retrenching. Housing, job losses and the credit
> crisis are likely to weaken the economy for the rest of the year and
> into 2009.
>
> ``There's no underlying support for the housing market,'' said Adam
> York, an economist at Wachovia Corp. in Charlotte, North Carolina.
> ``The economy as a whole is in fairly poor shape.''
>
> The leading indicators index, a measure of the economy's likely path
> over the next three to six months, is due for release on Aug. 21.
>
> Commerce's housing report may also show building permits, a sign of
> future construction and a component of the leading index, fell 15
> percent last month, according to the Bloomberg survey.
>
> A change in New York City's building code that took effect July 1
> caused housing starts and permits to unexpectedly surge in June as
> builders broke ground ahead of the new regulations.
>
> The magnitude of the projected July drop in starts and permits
> reflects, in part, ``a payback from the big jump'' the month before,
> York said.
>
> Sales Fall
>
> Underneath the gyrations, demand continues to weaken. Existing home
> sales fell to a 10-year low in the second quarter and the median price
> for a single-family house slid 7.6 percent, according to the National
> Association of Realtors. A third of all sales were foreclosures or
> ``short sales,'' in which lenders take a loss on a property
>
> To make matters worse, financing is also becoming scarce, a quarterly
> survey of banks by the Federal Reserve showed. Three- fourths of the
> loan officers polled reported they tightened standards on prime
> mortgage loans, up from the April survey. Lending rules on non-
> traditional loans were also toughened.
>
> The five largest U.S. homebuilders reported a combined $1.08 billion
> in losses in their most recent quarters.
>
> http://www.bloomberg.com/apps/news?pid=3D20601087&sid=3DaPLvjOT0ToJE&refe=
...
According to the Bureau of the Census the (2005) marriage rate per
1000 was 11.2. With a
population of approximately 305,000,000 that will translate to about
3,416,000
marriages per year. So lets suppose that only 1/3 of those couples
contracted for the building of
new homes. That would be about 1,138,667 new home starts per year.
That is 18.6% more than the 960,000 estimated in the Bloomberg News
survey. So it is possible that the Bloomberg estimate is understated.
Every bride and her groom
should get a free ride to the room
selected for their marriage consummation.
Then the man and his new spouse
should be granted a loan for a house
which will improve the housing market situation.
And with the rising values of real estate
the economy will accelerate
to a more productive state of operation.
And when singles start tying the knot
the economy will again be hot
and bring more stock market appreciation.
www.intelrap.com
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