New real estate construction plummets in August

The rate of privately owned single-family housing starts fell about 20.6 percent in August compared to August 2005, while total housing starts dropped about 19.8 percent, the U.S. Census Bureau and U.S. Department of Housing and Urban Development reported today.

And the rate for all privately owned housing starts dropped about 6 percent from July 2006 to August 2006, the agencies reported. The seasonally adjusted annual rate of housing starts was 1.67 million in July. This rate is a projection of a monthly total over a 12-month period, adjusted for seasonal fluctuations.

Single-family housing starts in August were at a rate of about 1.36 million, and the August rate for units in buildings with five units or more was 265,000, down about 16.9 percent from the August 2005 rate.

The rate of privately owned housing units authorized by building permits dropped about 21.9 percent in August compared to August 2006, and fell about 2.3 percent from July 2006, to 1.76 million.

Single-family building permit authorizations in August hit a rate of 1.28 million, which is down about 25 percent from the August 2005 rate and about 3.5 percent lower than the July 2006 rate. Authorizations of units in buildings with five units or more were at a rate of 370,000 in August, down about 10.2 percent from the August 2005 rate.

Privately owned housing completions in August were at a seasonally adjusted annual rate of 1.87 million, which is about 3.2 percent below the revised July estimate and about 4.4 percent below the August 2005 rate.

Single-family housing completions in August were at a rate of 1.62 million, which is about 2.5 percent below the July figure and 2.1 percent below the August 2005 rate. The August rate for units in buildings with five units or more was 230,000, down about 9.8 percent from the August 2005 rate.

The agencies noted that month-to-month changes in seasonally adjusted statistics typically show irregular movements. It may take four months to establish an underlying trend for building permit authorizations, five months for total starts, and six months for total completions.

Statistics are estimated from sample surveys and are subject to sampling variability as well as non-sampling error, including bias and variance from response, non-reporting, and under-coverage.

On average, the preliminary seasonally adjusted estimates of total building permits, housing starts and housing completions are revised about 1 percent.

All rights reserved. This content may not be used or reproduced in any manner whatsoever, in part or in whole, without written permission of Inman News. Use of this content without permission is a violation of federal copyright law.