Single-family construction falls to 17-year low

From CNN:

Initial construction of U.S. homes rose unexpectedly in April, but the
all-important single-family housing start measure fell to another 17-year low,
according to a government report released Friday.

Privately owned housing starts rose to a seasonally adjusted annual rate of 1,032,000 in April, according to the Commerce Department. The rate was up 8.2% from March’s revised reading of 954,000 but 30.6% lower than April of 2007.

and:

Total housing starts got a boost from multi-family homes. Buildings with
five or more units rose 7.3% to a seasonally adjusted rate of 294,000, and homes
with two to four units rose 2.7% to 38,000.

and:

Construction of new single-family homes registered the lowest reading of
that measure since January 1991. Single-family housing starts were at a rate of
692,000 in April, 1.7% below March’s number. Single-family homes are considered
the core of the housing market.

Applications for building permits, however, rose to a seasonally adjusted annual rate of 978,000 last month. That’s 4.9% above the revised 932,000 rate in March. Economists were expecting permit applications to fall to 912,000.

That’s encouraging news for homebuilders, because building permits are considered a reliable sign of future construction activity. Single-family housing permits rose 4% to 646,000 in April, and multi-family homes rose 7.3% to 294,000.

With the number of homes under construction declining, and the numbers of apartments increasing, one can expect that there will be a more and more renters in the near future.

Photo: FOR RENT -- Snowbank!, originally uploaded by DavyRocket.

Linens ‘N Things files for bankruptcy

From the Pacific Business News:

Home furnishings retailer Linens ‘N Things filed for Chapter 11 bankruptcy
protection Friday and said it will close 120 underperforming stores as part of
its restructuring.

Clifton, N.J.-based Linens Holding Co., parent of the
chain, said the Chapter 11 filing was largely the result of the economic
downturn.

“The significant deterioration in the mortgage, housing and
credit markets and the resulting impact on the retail marketplace, particularly
the home sector, has overwhelmed the operating and merchandising improvements
that we have made over the past two years,” said Robert J. DiNicola, Linens
Holding executive chairman, in a release. “We are making the strategic decision
to use a Chapter 11 filing to proactively address our capital structure and
ensure that our stores will remain well stocked while we work through the steps
to align the capital structure of the company with the realities of today’s
business environment.”

Proof positive that the problems in the housing market are spilling over into related industries. Earlier Home Depot announced it was laying off 1,300 employees and closing 15 stores. Now, Linens ‘N Things has filed for bankruptcy.

Not to mention Starbucks.

Real estate investors should expect some great deals on props for home staging!

Photo: Color Your Life, originally uploaded by Orangeya.