Is Home Building Facing a Decline?: New Pinch Is Feared In Building
a hard-handed Federal Reserve System credit squeeze is responsible. The central bank is tightening its credit screws in a determined attempt to halt the inflationary spiral that broke loose several months ago. Home building and would-be home buyers will be hurt and will be hurt badly. They always are the first to be hit by a credit shortage.</br></br>The threatened recession would be Hie second enforced slowdown that home building has suffered in the last 24 months. It was hit a devastatingLy hard blow by the credit crunch that the Federal Reserve imposed to stop the 1966 inflationary upsurge.</br></br>The only bright spot is that the coming squeeze may not be quite as damaging as the destructive 1966 punch.</br></br>ÛÏI think the impact may be a little less severe but home building is going to be hurt Ûª a top official declared. ÛÏI donÛªt see how they can get out of it. You canÛªt get by without some bloodletting.Û</br></br>million a year clip but it wonÛªt be long before the rate skids to 1 million or less if the credit squeeze exacts its anticipated toll. The prospect of a home building recession contrasts starkly with President JohnsonÛªs ambitious call for 6 million new moderate and low-income homes in the next 10 years and the Riot CommissionÛªs dramatic demand that 6 million be built in 5 years. It takes mortgage loans to build houses and tihe money is not to be had in an anti-inflationary credit squeeze.