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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club -- Ignore unavailable to you. Want to Upgrade?

To: MrGreenJeans who wrote (14517)	6/16/2000 9:09:00 AM
From: Wally Mastroly	Respond to of 15132

Some Housing details from Bloomberg: U.S. Housing Starts Fell 3.9% in May to 1.592 Million Rate By Siobhan Hughes Washington, June 16 (Bloomberg) -- U.S. housing starts fell in May to the lowest level in a year as new construction declined on single-family homes, government figures showed today. Housing starts fell 3.9 percent last month to a seasonally adjusted annual rate of 1.592 million units from a revised 1.656 million units in April, the Commerce Department said. ``Housing will have a difficult time regaining upward momentum, and it most likely will inch lower in the months and quarters ahead,'' said Michael Moran, chief economist at Daiwa Securities America Inc. in New York, before the report. Home construction has declined since reaching a recent high of 1.822 million units in February. May's level is the lowest since an annual pace of 1.562 million units in June of last year. Analysts expected a 2.6 percent decline last month to an annual rate of 1.620 million units from April's previously reported annual rate of 1.663 million units. Starts of single-family homes fell 5.4 percent in May to a 1.250 million seasonally adjusted annual rate, the lowest level since 1.248 million units in April 1999. May starts of multi- family homes rose 2.1 percent to a 342,000 rate, following a 10.6 percent rise in the previous month. By region, starts fell 13.6 percent in the West and 8.9 percent in the Midwest, Commerce said. New construction rose 5.6 percent in the Northeast and 2.8 percent in the South. Building permits, an indicator of future construction, fell 4.3 percent to 1.492 million units at an annual rate, the slowest since 1.456 million in December 1997. May marked the fourth drop in a row and followed April's 2.4 percent decrease. Permits for single-family homes fell to a 1.25 million-unit rate in May, the lowest level since 1.08 million in December 1997, Commerce officials said. Builder Backlogs Construction has been steady as builders try to clear a backlog of orders from sales of homes three to six months ago. The average rate for starts of 1.689 million in the first five months of the year is still higher than the 1.667 million for all of last year. Washington Homes Inc., a builder just outside of Washington, said it had 1,473 homes that were sold but are not yet completed, as of April 30, a 19 percent increase from the same period a year earlier. Still, sales of new homes may be starting to feel the effects of higher mortgage rates which would eventually slow construction, analysts said. New home sales in April fell 5.8 percent to a seasonally adjusted annual rate of 909,000 units, the lowest level in five months, the Commerce Department said last month. The average interest on a 30-year fixed rate mortgage was 8.22 percent in the week ending today, compared with a rate of 7.65 percent at the same time last year, Freddie Mac statistics show. ``I do see things slowing down,'' said Robert Toll, chairman and chief executive of Toll Brothers Inc., the nation's largest luxury home builder, before the report. The rest of the industry seems to echo that point. Builder Expectations A gauge of U.S. home builders' expectations fell in June to the lowest level in more than 2 1/2 years as rising mortgage rates started to take their toll, an industry survey showed yesterday. The National Association of Home Builders' housing market index fell to 58 in June from a revised 62 in May. June's reading was the lowest since November 1997 when the index was 56. The index of expected sales over the next six months fell to 63 in June -- the lowest level in more than three years -- from a revised 66 in May. ``This is likely the beginning of a gradual and expected slowing following two years of exceptional strength in the single- family housing market,'' said association president Robert Mitchell, a builder in Rockville, Maryland. What's more, consumers aren't seeing the stock market gains they had in the past couple years. The Nasdaq Composite Index is down 6 percent so far this year. ``Rising interest rates and flattening equity values point toward continued gradual and uneven declines in the housing market,'' said Peter Kretzmer, an economist at Banc of America Securities in New York. Still, consumer confidence rose in May to the second-highest level, Conference Board figures showed. That suggested that rising interest rates have yet to cool demand. And applications for mortgages rose in the week ended June 2 to the highest level since Nov. 19, according to figures by the Mortgage Bankers Association of America. - Other data ... Investors also were waiting for the 10:00 a.m. release of the University of Michigan's consumer sentiment index. Economic reports yesterday showed a mixed picture on growth, as industrial production unexpectedly rose while a general economic index for the Philadelphia area fell.