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Drop in housing starts may mean fewer home buyersAccording to a joint release from the U.S. Department of Housing and the Census Bureau, the number of housing starts fell 10.6 percent during the month. Housing starts came in at a seasonally-adjusted 529,000 for October, which is down from September's revised 592,000. When compared to October of last year, which saw 763,000 housing starts, the number is down 30.6 percent. For single-family homes, starts fell 6.8 percent in October when compared to September and came in at a total of 476,000. Furthermore, the number of building permits issued also declined during the month. Permits fell 4 percent overall and dropped 0.2 percent for single-family homes. The drop in housing starts is probably tied in to the fact that a credit for first-time home buyers was set to expire at the end of November. However, that credit - which gives first-time buyers $8,000 - was extended through April 2010. It was also expanded to include people who are considering transitioning into a new primary residence and would grant those people $6,500. Along with housing starts, builder confidence is still rather low, according to a recent survey from the National Association of Home Builders. The NAHB/Wells Fargo Housing Market Index showed that builder confidence in sales remained at 17 for November. Anything above 50 indicates more positive feelings among builders. "When the HMI survey was conducted at the beginning of this month, home builders were facing the imminent expiration of the $8,000 first-time home buyer tax credit at the end of November, with no guarantee that this valuable buyer incentive would be extended," NAHB chairman Joe Robson said.
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