March housing starts at 17-year lowMarch housing starts at 17-year low

Housing starts in March dropped to a 17-year low, the Commerce Department said yesterday.

New-home starts fell 11.9 percent in March from February to an annual rate of 947,000 homes - the fewest number of starts since March 1991, the department reported.

Starts fell 36.5 percent from March 2007.

Starts for single-family homes declined 6.2 percent nationally month-to-month. Construction of multifamily homes, such as townhouses and apartment buildings, fell 25 percent to an annual rate of 267,000 in March from February.

Single-family starts also fell 46.4 percent in March of this year from March 2007.

Total starts in the Northeast fell 8.5 percent month-to-month and 24.8 percent from March 2007, the Commerce Department reported. Single-family starts in the Northeast were up 1.6 percent month-to-month but down 30.4 percent from 2007.

Single-family building permits declined 6.2 percent nationwide and were down 12.3 percent in the Northeast between February and March. Year-over-year, the drops were 40.9 percent for the nation and 39.4 percent for the Northeast.

"Home building continues to collapse as builders struggle to work off their bloated inventories of unsold homes and try to survive," said Mark Zandi, chief economist at Moody's Economy. com in West Chester. "The over 60 percent decline in housing starts from their peak two years ago is the largest since the Great Depression."

Joel F. Naroff, chief economist at Commerce Bancorp Inc., of Cherry Hill, said that if the decline continued, "pretty soon there will no longer be any firms around that can be called builders."

The National Association of Home Builders was equally pessimistic, with chief economist David Seiders predicting a 30 percent drop in new-home sales this year.

Naroff said the good news was that the number of homes under construction kept falling. That, he said, was keeping down the supply of new houses coming on the market as new-house inventory had been increasing.

That and builder incentives are pushing many new-home buyers into the market.

Bernard and Sharon Dunkel, both in their early 60s, chose this time to downsize from their Mount Laurel house and buy at J.S. Hovnanian's Montebello development in West Berlin.

"It's a little smaller house," Bernard Dunkel said. The couple settled for $430,560 on Jan. 30 and sold their old house to their daughter.

The Mortgage Bankers Association reported yesterday that mortgage and refinancing applications rose slightly last week as qualified buyers sought to take advantage of 30-year fixed rates below 6 percent.