Asheville Mountain Real Estate Blog

Asheville, NC real estate for sale. Information for buyers, sellers and mountain homeowners, without pressure. Rich content for those who are far away about what it is like to live here through the generous use of media. And some nostalgia with our, "Baby Boomers' Fun Stuff", Thanks for stopping by.

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Location: Mars Hill, NC, United States

A small, highly personalized real estate firm specializing in mountain homes and land in greater Asheville.

Tuesday, May 20, 2008

Housing Starts: Behind the Headlines Part 2

Yesterday, we examined the recent headlines about housing starts. When looking behind those reports, we found that the much heralded 8.2% increase was entirely the result of starts on multi family dwellings of five or more units, and not related to single family homes. Single family starts remain roughly 40% less than last year.

There is however, a bright spot in another recent report. Calculated Risk offers the following key insight and data:
It now appears that starts are running below sales, and completions have fallen to the level of sales. Note: when adjusted for cancellations, completions are probably also below sales, and the inventory of New Homes is finally declining.
This goes to the very heart of supply and demand, and is something we have been waiting a very long time, really, to see in the present market. Maybe, the balance between sellers' prices and buyers' willingness will actually lower those inventories in the months ahead.

New home inventories, in the latest data available represent an 11 month supply, it would be nice to see that drop to 6 months. Existing home inventories for the latest data stood at a 9.9 months' supply. The year 2005 came in at 4.5 months, while 2006 stood at 6.5 months.

The bottom, or even the approach to the bottom, is still a long way off with numbers like that, but a glimmer of hope perhaps. Like any commodities or securities trader would do, we will look for confirmation in the months ahead.

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