Housing Strong For Last Month: Housing at 2 Million Annually
Housing construction remained strong last month, the government said yesterday, but interest rates have soared dramatically since, and builders are bracing for a sharp slowdown in 1979.</br></br>New construction of homes and apartments was at an annual rate of 2.08 million units in OctoberÛÓvirtually unchanged from September, the Commerce Department said. It was the eighth consecutive month that starts have been above the 2 million mark, a level economists consider to be healthy.</br></br>However, building permits, which indicate future housing construction, fell 2.9 percent, the department said.</br></br>ÛÏWe believe that starts should finish the year at nearly 2 million, which is great,Û said Michael Sumichrast, chief economist for the National Association of Home Builders. ÛÏBut next year will tell a different tale, and starts should fall to about 1.5 million.Û</br></br>The government has issued slightly more optimistic estimates, saying starts will fall to between 1.65 and 1.7 million in 1979.