The market is still very slow. New home constructions went up 6.7% in November, after dropping 14% in October, according to the Commerce Department with building permits falling 3% to a nine-year low. It is down 25.5% in the past year and 12.5% in the first 11 months of 2006 compared with the same period in 2005.
Building permits are considered to be an important indicator of the economy and with the housing market fell 3% is worrying some analysts. Down 31.3% in the past year and 14.1% in the first 11 months of 2006 compared with the same period in 2005.
Another report from the Labor Department did not have better news when it found the producer price index rose 2% in November, while core prices at the wholesale level increased 1.3%, the biggest gain since 1980 and reversing October’s big decline. This will not help kindle an already cool market.
Never the less, we should be careful when analyzing numbers, as it can take five months for a trend to starts emerging from the data. Not even the government can say that starts increased in November.
Starts fell 8.1% in the West to the lowest level in five years.
