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Housing Starts Up – Site Geniality Down

The User's Profile Chris Martenson May 18, 2010
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In this Insider Report, I am going to connect a very oddly-matched set of data points in the housing market to recent events here on the site.

The first housing data point is in the very bullish-sounding news that housing starts increased for the second straight month and surged to an 18-month high.  Sounds like we’re out of the woods, right?  This is a fascinating story, in which a little context goes a long way.

Here’s the first piece of news:

Housing starts up 5.8%

Housing starts rose an estimated 5.8% in April to a seasonally adjusted annual rate of 672,000 from an upwardly revised 635,000 in March, the Commerce Department reported Tuesday. It’s the highest level of new construction since October 2008, when the financial crisis worsened.

Starts of single-family homes rose 10.2% in April to a 593,000 annual rate, the highest since August 2008.

You’ve got to admit that 672,000 housing starts is a very strong number and clearly points to rising economic activity in the residential building sector.

The odd part about this story is this:  We also know that unoccupied housing; that is, empty homes with nobody living in them and most of them seeking buyers, is hovering at more than 19,000,000 units, or 14.5% of the total, according to the Census Bureau.

One might think that with so many unoccupied houses, there wouldn’t really be a need for more homes, especially not a big surge of brand-new homes.

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Top Comment

Chris
You are absolutely right.  People just process things differently and this is both good and bad and neither good or bad.  A paradox?  Yes.
But as...
Anonymous Author by pseanthebull
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