MSNBC: Housing construction falls to 12-year low, Data indicate real estate slump is worsening

[Amerigo Vespucci]

Housing construction falls to 12-year low
Data indicate real estate slump is worsening

Updated: 5:45 a.m. PT Sept 19, 2007

WASHINGTON - Construction of new homes fell in August to the slowest pace in 12 years as troubles in the housing industry continued to intensify.

The Commerce Department reported Wednesday that construction of new homes fell by 2.6 percent in August to a seasonally adjusted annual rate of 1.331 million units.

The housing industry is experiencing its steepest downturn in 16 years with analysts forecasting weak prices and further declines in sales for months to come, given rising mortgage defaults which are dumping even more homes on an already glutted market.

On Tuesday, the National Association of Home Builders reported that its index of builder confidence fell in September to 20, tying the lowest level on record.

http://www.msnbc.msn.com/id/20868561/

[poverlay]

1. I wonder if there is any quantifiable way to gauge the potential domino effect here. If anyone

knows any good economic websites dealing with this issue I'd love to read them. The more expert the better.
Thanks

[SoCalDem]

2. Think carpet stores, furniture stores, Home depot, Lowes, appliances

window companies, paint companies, landscapers, ...

all these industries & their employees will take hits, and once that starts to happen big-time, people who USED to have those jobs, will stop going to the movies, to restaurants, stop buying video games for their kids, stop taking vacations, stop buying cars..etc..

[TygrBright]

3. Very painful. But very necessary.

A widespread, long-lasting financial downturn that ripples through every sector of the population might finally convince the middle class (yes, me too) that it is a better investment to reduce debt, save for contingencies, put cash away for retirement and major expenses like a child's education, etc., than it is to have the kitchen redone, to take that cruise to Cabo San Lucas, or to make sure their kid never, ever feels as though 'all the other kids' have something(s) s/he doesn't.

It might finally convince us that substance is worth more than style, as in-- a secure, reasonable mortgage on an affordable house that is just adequate for our needs is worth more than the flashy oversized pseudopalazzo being advertised so enticingly as an extension of our egos.

If it goes on long enough and hurts bad enough, it might finally force us to force the government to make some serious restructuring moves that will flatten out the wealth distribution curve again and create some broad-based economic opportunities for people other than big money investors.

I don't like the thought of that kind of pain barrelling down the road at us, but if we can't escape it, maybe we can at least learn from it.

gloomily,
Bright

[SoCalDem]

4. our family is in good shape, with no debt (except the house)

but many are not..:cry:

There will be some real pain, and unfortunately once one is deep in debt, ther can be no saving..

This was the evil plan, I fear.. Keep people broke and owing, and they can never amass any real wealth.. :grr:

If credit were truly tightened to where it used to be, most malls would close up shop completely.

Our economy went from employing people to make things to sell to each other...keeping the same money circulating within our country, to loaning people money to buy imported shit made by people who do our former jobs for 1/5 what we used to make.. Run out of money?? borrow some more :grr: