The following is NAR Chief Economist Lawrence Yun’s reaction to this morning’s U.S. Commerce Department report on residential construction in February:
“The fall in housing starts in February is a movement in the wrong direction. The key to economic prosperity at this juncture of economic expansion is to produce more new homes. That will help with job creation and reduce the swift price appreciation in several markets.
A total of 1.2 million homes were constructed last year, which was vastly inadequate. Last month’s annualized rate of 1.24 million is only a hair above 2017’s figure. It’s not enough. While relaxing regulations on small-sized community banks may spur more construction loans for building, labor shortages in the industry continue to stunt overall activity.”