Does this look like a bottom to you ?
chart courtesy of Barron’s Econoday
The Commerce Department released the Housing Starts data. It was not pretty
Construction of single-family houses in April dropped to the
lowest level in 17 years. Builders broke ground on 692,000 single
units at an annual rate, the fewest since January 1991.
Multiifamily units — Condos, townhouses, and apartments — rebounded for the month. Total housing starts were up 8.2% since last month, but plummeted 30.6% below the level of construction in April 2007.
Builders have been reluctant to build because demand for new homes has
plunged and the supply of unsold property remained high. The latest
data show new-home sales, for March, were down 36.6% from a year
earlier. On Thursday, the National Association of Home Builders
reported its index for sales of new, single-family homes slipped to 19
in May from 20. The gauge is based on a survey of builders asked about
prospects for sales.
The overall WSJ article was good, despite the WTF headline: Housing Starts Post Surprise Rise. Bloomberg seemed to find a better balance int heir header: Housing Starts in U.S. Rise; Single-Family Construction Hits 17-Year Low.
Given the huge inventory overhang, weak housing starts is (perversely) a positive for the housing market!
NEW RESIDENTIAL CONSTRUCTION IN APRIL 2008
Manufacturing and Construction Division
U.S. Census Bureau, MAY 16, 2008 AT 8:30 A.M. EDT
Housing Starts Post Surprise Rise
JEFF BATER May 16, 2008
WSJ, 9:51 a.m.
We have previously reviewed the Uncle Sam’s withholding tax data as a read into the overall health of the economy. The most recent data point (March 13) shows W/H tax reaching a 23 month low. But we don’t like to rely on any single data point, especially one from a volatile series. Instead, look at…Read More
Another appearance on Kudlow & Co. tonite, from 7:00 to 7:30pm (ish).
Also on tonite: David Malpass, Bear Stearns chief economist, Jimmy Pethokoukis, senior writer at U.S. News & World Report, Andy Busch, global FX strategist at BMO Capital Markets, Jim Awad, chairman of WP Stewart Asset Management, and Don Luskin, chief investment officer, Trend Macro.
Note that Jimmy Pethokoukis and I have a bet as to whether or not there is a recession or not.
UPDATE: May 14, 2008 11:47pm
Considering it was 4 on 1, I thought I held up pretty well.