Housing starts rebound (a little)

The Census Bureau reported that housing starts rose in October, but not by much. Building permits, a more important leading indicator for residential construction, fell for the 18th time in the last 21 months to a new 14-year low.
This report at Bloomberg has a few more details - it sounds like the cheery headline was a result of new condominium projects that may prove to be a tough sell when they are done:

Housing starts in the U.S. unexpectedly rose in October as a jump in work on condominium projects outstripped the weakest construction of single-family homes in 16 years.

Builders broke ground on 1.229 million homes at an annual rate last month, up 3 percent from September, the Commerce Department said in Washington today. Construction of single- family homes fell 7.3 percent to the lowest since October 1991. Multifamily home building surged 44 percent.

Sales of single-family homes are dropping as potential buyers wait for prices to fall even more and some banks make it more difficult to get mortgages. Demand is declining as fast as construction, preventing builders from trimming inventories and suggesting the real-estate recession will linger into 2008.

"All of us are ratcheting down our expectations for the bottom of the housing sector and I don't think we're there yet," said David Resler, chief economist at Nomura Securities International Inc. in New York.
...
Toll Brothers Inc., the largest U.S. luxury homebuilder, said Nov. 8 that fourth-quarter revenue fell 36 percent and the cancellation rate rose to the highest ever.

"We do think that this is worse than it was in '88 through '90," Chairman Robert Toll said on a conference call. "We can't predict how long this down period will last."

No, it's still too early to call the bottom, though some will probably do so anyway.

To remind readers of past "bottom calling" folly, here's a brief stroll down memory lane from nine months ago - Definitely Not the Bottom. It contains the memorable late-2006 National Association of Realtors ad campaign along with the late-2006 bottom call by former Fed chief Alan Greenspan under the heading POSITIVE OUTLOOK:

Former Federal Reserve Chair Alan Greenspan recently said that housing prospects are looking up. "Most of the negatives in housing are probably behind us. The fourth quarter should be reasonably good, certainly better than the third quarter."

In retrospect, maybe NOT SO POSITIVE. How many people do you think bought real estate a year ago based on this reassurance?