Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, March 17, 1994 TAG: 9403170164
SECTION: BUSINESS PAGE: B-7 EDITION: METRO
SOURCE: By JOHN D. McCLAIN Associated Press
DATELINE: WASHINGTON LENGTH: Medium
Housing starts rose 4.1 percent, to a seasonally adjusted annual rate of 1.31 million units in February, but failed to recoup the 22 percent loss in January, when the annual rate was 1.26 million, the Commerce Department reported Wednesday.
The January loss was the biggest in 10 years.
Despite the pickup in February, the weather had a negative impact on housing activity, said economist Bruce Steinberg of Merrill Lynch & Co. in New York. ``We expect a further rebound in housing activity in March.''
``We lost a lot of activity in January and February,'' concurred David Seiders, an economist with the National Association of Home Builders. But he added, ``We should get that back within a couple of months.''
Builders did boost construction in the Northeast and South, but lost further ground in the Midwest and West, which continued to suffer from the effects of the Los Angeles earthquake.
Despite the slow beginning, housing starts in the first two months of 1994 still were 9.5 percent above those of the same period a year earlier.
Seiders maintained that housing starts reached their cyclical high in December, when the rate was 1.61 million, although he predicted they would remain at a ``healthy level'' of about 1.41 million this year, up from 1.29 million in 1993.
Single-family starts were up 2.1 percent in February, to a 1.13 million rate, after plunging 19.7 percent in January. Still, the home builders association is predicting single-family starts will total 1.29 million in 1994, which would be the best since the 1.43 million total in 1978.
Multi-family starts also rose, up 18.9 percent after plunging 35.4 percent in January.
Although Seiders said builder surveys show continuing optimism about consumer demand, the Commerce Department said applications for building permits were down 7.9 percent, to a 1.25 million rate, on top of an 8 percent loss a month earlier. Permits often are a barometer of future activity.
Regionally, starts shot up 51.2 percent in the Northeast, to a 130,000 rate, and 8.5 percent in the South, to 590,000. But they fell 9.1 percent in the West, to a 339,000 rate, and 2 percent in the Midwest, to 250,000.
by CNB