New residential construction figures reflect uncertain market

The U.S. Department of Housing and Urban Development recently reported that building permits for privately-owned housing units in October increased 10.9 percent from September and 17.7 percent compared with October 2010. Authorizations of single-family homes in October grew 5.1 percent compared with September, while authorizations of buildings with five units or more grew at a rate of 202,000 for the month.

Housing starts in October decreased 0.3 percent compared with September, but were up 16.5 percent compared with October 2010. Single-family housing starts for the month were 3.9 percent above the September figures. Housing completions increased 5.7 percent in October compared with September and 2.8 percent below October 2010.

In an interview with Bloomberg, Eric Green, chief marketing economist at TD Securities, said low mortgage rates and reduced housing inventory should benefit home builders, but foreclosures are still clogging up the market and depreciating home values. 

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