Housing.com News, Analysis & Opinion: Buying And Selling: Home Construction Hits Six-Year-Low

That's the unfortunate news regarding new home construction for October, as the Commerce Department glumly reports the continuing effects of excess inventory and frightened buyers:

The report signaled that the months ahead could be equally bleak: The number of building permits that were issued fell for the ninth straight month, reaching its lowest level since 1997. Those figures, too, are seasonally adjusted....The report deepened concerns that the contraction in the housing market could brake economic growth more sharply than many economists have been forecasting. And it weighed against any hope for a quick rebound.

A private survey of U.S. homebuilders' sentiment ticked higher in November. The National Association of Homebuilders/Wells Fargo Housing Market Index on Thursday got a two-point bump to 33 points in November. The survey hit at 15-year low of 30 in September.And on Wednesday, the Mortgage Bankers Association reported that applications for U.S. home mortgages rose last week to their highest level since January as falling interest rates encouraged more loan refinancing.

Now, the question is what kind of loans are homeowners refinancing into? If the terror that is WAGE GAINS is for real, are people taking advantage of their increased buying power to go for traditional fixed loans? And will the relatively positive signs of economic strength be enough to buffet the continuing deceleration of the housing sector?

Kendra Todd provides some good advice for a buyer's market, and the Urban Trekker has found some great bargains for under $400,000 in the infamously bubbilicious D.C. housing market. Are these the signs of the end of the slowdown, or just the beginning? Hard to say. Those lower-end prices could be for total fixer-upper s?!tboxes, and there's no guarantee of being able to get into them without utilizing toxic mortgage products. But a year ago, would we have even broached the idea of a buyer's market?

I will answer this with a quote from the guru of all things housing bubble, Ben Jones:

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That's the unfortunate news regarding new home construction for October, as the Commerce Department glumly reports the continuing effects of excess inventory and frightened buyers: The report signaled that the months ahead could be equally bleak: The number of building permits that were issued fell for the ninth straight month, reaching its lowest level since 1997. Those figures, too, are seasonally adjusted....The report deepened concerns that the contraction in the housing market could brake economic growth more sharply than many economists have been forecasting. And it weighed against any hope for a quick rebound. And yet, if you go with MSN Money's take on it, it's merely a sign that the market has hit rock bottom: A private survey of U.S. homebuilders' sentiment ticked higher in November. The National Association of Homebuilders/Wells Fargo Housing Market Index on Thursday got a two-point bump to 33 points in November. The survey hit at 15-year low of 30 in September.And on Wednesday, the Mortgage Bankers Association reported that applications for U.S. home mortgages rose last week to their highest level since January as falling interest rates encouraged more loan refinancing. Now, the question is what kind of loans are homeowners refinancing into? If the terror that is WAGE GAINS is for real, are people taking advantage of their increased buying power to go for traditional fixed loans? And will the relatively positive signs of economic strength be enough to buffet the continuing deceleration of the housing sector? Kendra Todd provides some good advice for a buyer's market, and the Urban Trekker has found some great bargains for under $400,000 in the infamously bubbilicious D.C. housing market. Are these the signs of the end of the slowdown, or just the beginning? Hard to say. Those lower-end prices could be for total fixer-upper s?!tboxes, and there's no guarantee of being able to get into them without utilizing toxic mortgage products. But a year ago, would we have even broached the idea of a buyer's market? I will answer this with a quote from the guru of all things housing bubble, Ben Jones: The market is overbuilt, and the only cure for that is time, not rate cuts. Word.