Good news on housing starts but still a long way to go

Posted at 1:52 PM on December 20, 2011 by Paul Tosto
Filed under: Housing and mortgages

Earlier in the day, local mortgage and housing expert Alex Stenback pulled back the reins on the euphoria over the better-than-expected November housing starts data.

Look at 50 years of trend and you can see why. Housing starts have never fallen this hard, this fast in a recession.

This chart doesn't have today's data posted. Today's numbers -- estimating 685,000 starts at an annual rate -- will bump up that chart but still nowhere near "the 1.2 million homes that economists say would be built each year in a healthy housing market," according to the New York Times.

The other thing to keep in mind as you look at that chart: Housing starts often jumped sharply while the economy was still in recession and providing some real economic muscle into and through recoveries.

That's not the case this time.

So while the markets today applaud the newest numbers, there's still a long road ahead for the new housing construction business and all the workers who depend on it.