The housing market, caught in the grip of the nation’s overall financial crisis, is showing no signs of recovery, with the downturn shaping up as the worst in the post-World War II era (see related graph, right). Among the statistics and forecasts released by government agencies, research firms and industry-related trade associations in recent weeks were the following:

Housing Starts & Sales

Reflecting “profound uncertainties” tied to financial market shocks, builder confidence in the market for new single-family homes receded to a record low in October, the National Association of Home Builders reported last month. The Washington, DC-based NAHB pointed to events on Wall Street, the deterioration in job markets and weakness in consumer confidence as the key reasons behind declining builder confidence. In an ongoing effort to pare down inventories of unsold homes, builders further reduced housing production in September, with U.S. housing starts falling 6.3% to a seasonally adjusted annual rate of 817,000 units, the slowest building pace since early 1991. In contrast, sales of newly built single-family homes turned upward in September, posting a 2.7% gain to a seasonally adjusted annual rate of 464,000 units.

Existing-Home Sales

Existing-home sales increased in September – the first time since November 2005 that home sales have been above year-ago levels – according to the National Association of Realtors. Resales rose 5.5% to a seasonally adjusted annual rate of 5.18 million units in September, from a level of 4.91 million in August; they were 1.4% higher than the 5.11-million-unit pace in September 2007, the NAR said. Sales were boosted by improved affordability conditions, the NAR said. Impacted by the large supply of unsold homes, tighter lending standards and record foreclosures, prices of U.S. single-family homes plunged a record 16.6% in August from a year earlier, Standard & Poor’s reported last month. The national median existing-home price for all housing types was $191,600 in September, down 9% percent from a year ago, the NAR said. Compared to a fairly small share of foreclosures or short sales a year ago, distressed sales currently represent 35-40% of transactions, the NAR pointed out.

Residential Remodeling