 US building sector struggles on
The building sector is getting worse in the US as fears for unemployment override the desire for a new home. In the sixth fall in a row, The Commerce Department says building of new homes dropped 15.5 per cent in December to a seasonally adjusted 550,000 annual rate compared to November.
Back at home, figures are no doubt dissapointing athough not quite as bad compared to the US with Australian building approvals falling 12.8 per cent in November.
The US housing markets are struggling despite lower mortgage rates, as people worry about their job security and tight credit conditions.
"Builders have thrown in the shovel and the home construction sector has essentially disappeared," said Joel Naroff, who runs Naroff Economic Advisors.
Permits, which are a sign of future buildings, fell 10.7 per cent in December and US new-home sales dropped in November by 2.9 per cent.
Job losses are a real threat and already 2.6 million people lost their jobs in 2008. This concern is affectiing people's confidence to spend or invest.
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