The U.S. Census Bureau and the HUD Department announced the new homes construction stats for April 2008 today. Building permits were at a seasonally adjusted annual rate of 978,000 (1 units were at 646,000) which was 4.9% over the previous month, but 34.3% below April 2007. Housing starts were at a seasonally adjusted annual rate of 1,032,000 (1 units were at 692,000) which was 8.2% over the previous month, but 30.6% below April 2007. However, single-family starts were down 1.7% from the previous month. Housing completions were at a seasonally adjusted annual rate of 1,000,000 (1 units were at 792,000) which was 16.0% below the previous month, and 34.9% below April 2007. 
Rather than focus on the if construction is up or down, the focus should be on if there is a healthy amount of new construction. Before this current housing slowdown, about 98.1% of permits turned into starts (from 1997-2006), and 94.6% of permits were completed. Currently about 73% of new home construction is built for sale. The other homes are being built to be rented out or for owner use. In March 2008, 1 unit homes were selling at an annual pace of 526,000. Assuming typical completion and built for sale percentages, the permits issued will result in 80,000 less homes built than are currently being sold a year. The number of starts would result in 39,000 less homes built than are being sold. The number of completions are 52,000 more than are being sold a year. There is currently 11.0 months supply of new homes. Over 6 months supply indicates oversupply. As mentioned in this post, there are currently about 2 million excess homes in America. New home construction is now inline with sales, however this is not helping to reduce the oversupply of homes.
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