U.S. housing starts plunge in February — Vegas stays strong

Tuesday, March 18, 2003 | 11:22 a.m.

SUN STAFF AND WIRE REPORTS

The number of new housing projects builders broke ground on in February plunged by 11 percent nationwide, the sharpest decline in nearly a decade, as bad weather and an uncertain economic climate took its toll on the residential construction market.

Housing construction dropped to a seasonally adjusted annual rate of 1.62 million units in February, representing a 11 percent decline from the month before, the Commerce Department reported today.

The level of housing activity in February was weaker than the 1.75 million pace economists were forecasting.

Dennis Smith, president of Las Vegas-based Home Builders Research, Inc., said he has not seen any softening of the Las Vegas-area market.

"We have not seen any decline at all in terms of net traffic or net sales per subdivision," he said. "Builders are still bullish on Vegas."

In January, 1,922 new home permits were pulled in the Las Vegas area, compared to an average of 1,838 new home permits per month in 2002, Smith said.

Smith said a war with Iraq could change the local outlook, but said it is too soon to tell how international events could effect the local home-building market. February numbers for Las Vegas are not yet available.

The housing and residential construction markets have been one of the few bright spots of the ailing economy. But today's report raised new questions about the extent to which the residential construction market will continue to serve as a pillar supporting the sagging national economy.