Housing: The Bad News Continues
More bad news on housing starts and permits:
As I said in an earlier post, we are vastly overbuilt in housing. It will take several years to work off the excess inventory. Now let’s get some historical perspective:
This is not (yet) the lowest we’ve seen housing starts, not even adjusted for population growth. Nor it is (quite) the steepest decline we’ve ever seen. But it’s definitely a sharp drop.
Business Planning Implications: Still no signs of spillover to consumer spending, but the housing construction supply chain will stay weak for longer than most industry participants seem to realize, or at least to admit in public.
Comments
While the level is not at an all time low and the steepness of the drop not quite unprecedented, what does look unprecedented is the length of the rise from 1990 to 2005. No other period had such a sustained rise.
Does that say anything about what might be the length of the slump?