Housing starts down in July

The U.S. Department of Housing and Urban Development and the U.S. Census Bureau recently released the new residential construction statistics for July 2011, which found housing starts fell 1.5 percent to a seasonally adjusted annual rate of 604,000 - down from 613,000 in June. Building permits, an indicator of future construction plans, also dropped 3.2 percent from June, but increased 3.8 percent from July 2010.

USA Today reported 70 percent of home construction was on single-family homes, which fell 5 percent in July, while apartment building rose more than 6 percent. According to the news source, builders are competing with foreclosed properties and short sales that are filling the market.

Housing has historically accounted for 15 to 20 percent of overall economic growth after a recession, but between 2009 and 2010, the housing market has only contributed 4 percent to the recovery, the news source reported.

"The market is continuing to adjust to a reduction in the national home ownership rate at the same time the supply of existing single-family homes remain excessive," said Peter Boockvar, equity strategist at Miller Tabak and Co, in an interview with Reuters. 

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