A forecast report released Tuesday by the National Association of Home Builders projects that the state of Florida and metro areas within the state will experience the steepest declines in housing starts this year compared to last year.

Nationwide, total housing starts are expected to drop 24.8 percent this year compared to last year and fall 11.9 percent year-over-year in 2008, while rising 12.5 percent year-over-year in 2009.

Housing starts in Florida are projected to fall from 198,900 in 2006 to 103,300 this year, a 48.1 percent drop, the builders group reported.

And Florida is home to nine of 10 U.S. metro areas with the sharpest projected drop in housing starts from 2006 to 2007.

The Sarasota-Bradenton-Venice, Fla., metro area topped that list, with a projected 67.5 percent decline this year compared to 2006. Next on the list was the Cape Coral-Fort Myers, Fla., metro area, with a 61.4 percent projected drop.

The other metro areas on the top 10 list are expected to see a 50 percent or greater slide in housing starts from 2006 to 2007.

The Detroit-Warren-Livonia, Mich., metro area is the only non-Florida area in the top 10 for housing market declines, with a projected 50.5 percent drop.

Michigan was second among states for its projected 2006-07 decline in housing starts. Starts are expected to drop from 31,200 in 2006 to 17,500 this year, a 43.9 percent decline.

Housing starts are expected to fall 39.4 percent in Nevada, 38.5 percent in Alaska, 36.6 percent in Minnesota, 31.9 percent in Illinois, 28.7 percent in Wisconsin, 27.8 percent in California and Missouri, and 25.8 percent in Ohio this year compared to last year.

New York is the only state that is expected to have a gain in housing starts this year compared to last year. The NAHB Total Housing Starts Forecast anticipates a 5.3 percent rise in starts this year compared to 2006, from 47,200 starts in 2006 to 49,700 starts this year.

Mississippi is expected to have the slightest decline in starts this year compared to last year, with starts falling 2.3 percent — from 17,700 in 2006 to 17,300 in 2007.

Wyoming is next on the list with a 2.8 percent projected decline this year compared to last; followed by Montana with a projected 4.6 percent decline; Louisiana, down 7.95 percent; Kentucky, down 10.6; Washington, down 10.9 percent; Oklahoma, down 12.6 percent; Hawaii, down 13.5 percent; and Pennsylvania, down 13.9 percent.

The New Orleans-Metairie-Kenner, La., metro area, which is slowly rebuilding following devastating hurricanes in 2005, is projected to experience a 22.5 percent gain in housing starts this year compared to last — from 4,900 starts in 2006 to 6,000 starts this year.

The NAHB forecast expects the New Orleans metro area to see an 83.7 percent gain in starts from 2006 to 2009.

Only one other U.S. metro area tracked in the NAHB report, the Louisville, Ky., metro area, is expected to experience a gain in housing starts this year. That market area is projected to rise 3.7 percent, from 5,400 starts in 2006 to 5,600 starts this year.

And El Paso, Texas, is the only metro area besides the New Orleans area that is projected to experience a rise in housing starts in 2009 compared to 2006.

Year-over-year growth is expected in housing starts in five U.S. metro areas in 2008, including: New Orleans; Madison, Wis.; Reno-Sparks, Nev.; Washington, D.C.; San Jose-Sunnyvale-Santa Clara, Calif.; and Fort Collins-Loveland, Colo.

By contrast, only five metro areas tracked in the NAHB report are expected to experience year-over-year declines in housing starts in 2009, including: Cape Coral-Fort Myers, Fla.; Baton Rouge, La.; Provo-Orem, Utah; Lakeland, Fla.; and Myrtle Beach-Conway-North Myrtle Beach, S.C.

Housing starts in New York are projected to be flat in 2009 compared to 2006, and the NAHB expects that Louisiana starts will drop 2.3 percent in 2009 compared to 2006 — the slightest decline among states.

Nine of the 10 metro areas with the steepest projected drop in housing starts in 2009 compared to 2006 will be in Florida, according to the report, with the Cape Coral-Fort Myers area experiencing a 79.4 percent decline.

Washington, D.C., is expected to see a 72.2 percent decline in starts in 2009 compared to 2006, after projected year-over-year declines of 22.2 percent this year, 50 percent in 2008 and 28.6 percent in 2009.

NAHB stated in a forecast overview that all housing markets “will suffer from tighter lending standards but areas of the country that have high concentrations of subprime (adjustable rate mortgages) will suffer a second hit because these loans have exhibited much higher default rates, particularly the most recent vintages. Defaults and foreclosures in these markets could bring significant numbers of housing units back onto the market exacerbating the problem of already high unsold inventories.”

Also, high concentrations of subprime ARMs, coupled with economic weakness in some parts of the Midwest, “will slow recovery, particularly in certain markets in Michigan, Ohio and Indiana,” the overview states.

“Although there was some weakening in the most recent permit numbers, many of the stronger markets in the country are at or above pre-boom levels of production. These markets include MSAs in the Southeast, Texas, Pacific Northwest, Mountain states, and the Dakotas, where subprime ARM exposure and speculative activity have been limited.”

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