AP: “Construction Spending Plunged in July”

AP reports today on the continuing weakness in the national housing market:

Construction Spending Falls in July by Largest Amount Since January

The Commerce Department reported Tuesday that construction spending dropped 0.4 percent in July, compared with June, the weakest showing since a 0.6 percent fall in January.

It was a bigger drop than economists had been expecting and underscored the continued drag the severe slump in housing is having on building activity…

Housing activity fell by 1.4 percent, more than double the 0.6 percent decline in June, and has now declined for a record 17 straight months as home building suffers through its worst slump in 16 years. Economists believe the downturn will get even more severe in coming months, reflecting the spreading problems in the mortgage markets. Rising delinquencies, especially by borrowers of subprime mortgages, are dumping more homes on an already glutted market. That is forcing builders to slash construction plans even further and offer a variety of incentives to move the homes they have already built.

See also:

LA Times: “U.S. home prices declining at their fastest pace in two decades”

Bloomberg: Existing Home Sales At Slowest Pace in Five Years
Tighter rules for loans “could further dampen residential investment,” Fed Bank of Richmond President Jeffrey Lacker said Aug. 21 in a speech in Charlotte. “Recent data on actual housing market activity have dampened my optimism” about a bottoming-out in the industry, he said…

Boston Herald, 7/24/07: JUNE’S A BUST ALL OVER