[photopress:sputtering_starts.gif,thumb,alignright]Interesting story of the differing views from US (not U.S.) and those outside of the Rain City. One of my development partners (Mike) is from Michigan and is one of those 40 states with falling sales (not to mention increasing unemployment). As if the bubblers need any more endorsement to foster their cause the Seattle Times reported Housing sales fell in 40 states… but not the NW yesterday. Before I read the story in the times Mike sent me the view from the vast majority of the country as seen on CNNMoney.com ‘Housing starts plunge‘.
The CNN reported that housing starts fall much more than forecast, to their lower level since ’97. They go on to add what in turn I call the LARGE BUILDER EFFECT; permits also fall as single-family permits hit 6-year low. The Large Builder Effect is a trend that occurs and will effect new housing starts about 12 months down the road when the permits are issued (permit times vary in each municipality).
So what does this mean? The nation’s leading homebuilders have all reported declining sales and prices for new homes(hence the fall in permits). Another partner of mine Snohomish County builder I know actually expressed the same views in November, but said since the first of the year his sales have bounced back to their expectations and he is continuing to submit for permits.
Do people behind the Rain City Curtin have their blinders on? Time will only tell, but if history is any guide (and I am NOT a historian) I would guess in time, with a smaller supply of products, demand will eventually grown so even though sales may be sluggish, over a 3 year window sales will continue to grow.
NOTE: I am leaving town after today, but I will do my best to reply to comments.