Housing Starts Post Surprise Rise

[Mr. McD]

Source: Wall Street Journal

WASHINGTON -- Home construction turned up unexpectedly in April and showed surprising vigor, making the biggest increase in two years. However, the increase was driven by a surge in multi-family housing, while single-family starts dropped.

Housing starts increased 8.2% to a seasonally adjusted 1.032 million annual rate, driven higher by a surge in apartment building construction, the Commerce Department said Friday. Starts plunged 13.8% in March to 954,000, the data showed; Commerce initially estimated March starts down 11.9% to 947,000.

Read more: http://online.wsj.com/article/SB121094058802498537.html?mod=hpp_us_whats_news

[Birthmark]

1. Yeah, inflation is low, too. Good times, eh? LOL

[hatrack]

2. Yes, it's April. You know, "spring".

Warmer weather and all that.

:eyes:

[Hugin]

3. I thought the optimism was due to the fact Yellow is a color. n/t

[mbperrin]

4. BULLLLLLLLLLLLLLLLLLLLLL SHIIIIIIIIIIIIIIIIIIIIIIIIIIIT !

bout all I can say

[Stuart G]

5. Actually, not good at all..Builders are betting on apartments, not

single family dwellings. They are betting that people will not be able to afford mortgages, but will be able to afford to rent. And that is one year down the road..Now what message does that give you?

[Tempest]

7. Exactly

And rent prices are still rising, up about 8% in 2007, so whoever buys the property will make money.

[FarCenter]

9. The era of McMansion plantations is over

There is no demand for McMansions built on former cornfields or out in the desert 50 miles from a job.

What is needed are more apartments and condos in high-density areas near public transportation and close to jobs.

By renting you can move closer to your next job without paying 8% commissions, fees, and expenses on the total price of a house. Unless you get reimbursed for moving expenses, this pretty much wipes out equity gains in many cases.

[Tempest]

6. It makes sense

the increase was driven by a surge in multi-family housing

Rents are rising so the developers and owners can make money on the projects.

[ozone_man]

10. Rents are rising

because people are losing their homes increasing the demand for apartments. Like Stuart G says, this is not good news, except for apartment builders.

[Robbien]

8. These are housing starts, not housing sales

Inventories are currently standing at 11 months, up from 4 months a few years ago.

Starts are not sales. When you find yourself in this sort of hole, stop digging new foundations!

[customerserviceguy]

11. Generally speaking

multifamily housing tends to be clustered in more urban areas, so the builders are betting on high gasoline prices, as well as high rents. It's a lot easier to afford the 20 minute drive from the first ring of suburban cities in a major metropolian area, than to afford the hour-long commute from your single-family dwelling out in the boonies.