Home building rates drop sharply in the US
Homebuilding saw huge drop in home building in December and the years poor construction news shows drop that hasn't been seen since past recessions.
In December, the US saw housing starts and building permits fall, drastically, and even more than expected. The full year's decline in housing starts and building projects here hits a record sharpest drop in 27-year low. Economists say this is the first time this has happened since past recessions hit the country hard.
More so, the data released by the US Government says that these numbers for building permits were the largest drop in 33 years. This spurs economists to believe that if recession has not started, it will soon.
In December, housing starts lost 14 per cent which was 1.01 million in December (which is seasonally adjusted.) Additionally, when looking at Novembers numbers of 1.17 million, this is a drastic drop.
As reported by CNN money, Mike Larson, a real estate analyst for Weiss Research said, "Slumping consumer confidence and tighter lending standards have already taken their toll on demand, and the broader economic slowdown we're starting to see unfold now threatens to make a bad situation worse."
On the flip side, non residential lending should see a modest increase in 2008. While rise will be at a much lower rate, it will likely rise 0.7 per cent in 2008. Yet, it too is not protected from the credit crunch and housing slowdown here. In 2009, it is expected to decline by 0.9 per cent. This information is according to the latest survey out of the American Institute of Architects.