Some good news for the industry is that the Commerce Department reported that housing starts and permits posted substantial gains in June. The National Association of Home Builders (NAHB) says this is due in part to improved market conditions and the impending expiration of the first-time buyer tax credit.”The upcoming expiration of the first-time home buyer tax credit on December 1 is encouraging some builders to get homes started now so that they can be completed in time for clients to take advantage of this attractive buying incentive,” says NAHB chairman Joe Robson, a home builder from Tulsa, Okla. “However, there is still much concern about the difficulty of financing new-home production and continuing weakness in the job market.”

The figures showed a 3.6 percent gain in overall housing starts to a seasonally adjusted annual rate of 582,000 units and an 8.7 percent gain in permit issuance to 563,000 units.

Single-family housing starts rose for a fourth consecutive month in June, posting a 14.4 percent gain to a seasonally adjusted annual rate of 470,000 units, while single-family permits rose for a third consecutive month, posting a 5.9 percent gain to 430,000 units. Meanwhile, the multi-family side, which characteristically displays greater month-to-month volatility, posted a 25.8 percent decline in starts following an unsustainably large gain in the previous month, to 112,000 units. Multi-family permits rose 18.8 percent to 133,000 units from an abnormal low in May.

Regionally, housing starts were mixed, with the Northeast and Midwest posting big gains of 28.6 percent and 33.3 percent, respectively, and the South and West posting declines of 1.4 percent and 14.8 percent, respectively. However, the declines in both the South and West were entirely driven by dips in multifamily production.

Permit issuance was up across the board in June, with the Northeast posting a 5.4 percent gain, the Midwest a 3.4 percent gain, the South a nearly 14 percent gain and the West a nearly 2 percent gain.

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