Housing Market Perks Up in March

Posted by Rumin Mann
May 10th, 2011

The March housing market reports were uniformly better than the grim reports for February. And the January and February reports were revised slightly higher for permits, starts and sales after a reassessment of seasonal adjustment factors during the harsh winter. Nonetheless, housing has not gotten off to good start in 2011. So far new home starts are 10% below the same months in 2010 and new home sales are off nearly 20%. For comparison, spending for new home construction year to date is down 7%, half of the 14% drop for nonresidential construction but well below the 4% gain for heavy construction.

The year/year dip in the housing market is an unfair comparison with the period when the homebuyer tax briefly caused a surge in the market which was not sustained. Housing market activity should be seen as flat for about two years — still waiting to break out of the bottom of the housing recession. That is now expected to happen this spring.

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