New Home Building Drops For 2nd Month

The Arizona Republic reports that construction of new homes in the U.S. slipped for the second straight month, providing fresh evidence that the nation's housing boom may be cooling.

The Commerce Department reported a 1.3% drop in August, which followed a 1.5% decrease in July. Even with the declines, housing construction totaled 2.01 million units in August. "We see a flattening of housing starts and the beginning of a cooling process," said David Seiders, chief economist at the National Association of Realtors.

A survey of builder sentiment dropped in September for the third straight month to the lowest level it has been in two years.

Ken Simonson, chief economist for the Associated General Contractors of America, forecast that the price of building materials will rise by 10 percent or more next year. More...