The collapse of the housing sector was a major driver of the nation’s economic woes. Now, a new wave of weakness in housing poses risks to the fragile economic recovery.
Fresh data released this week offer a portrait of a residential sector that is muddling along at low levels, though nothing resembling the freefall of 2006 to 2009. On Thursday, the National Association of Realtors said sales of previously owned homes rose 7.6 percent in August – a disappointing result, as analysts had hoped for a stronger bounce back after sales tumbled 27 percent in July.
That followed a report Tuesday that builders started work on more new homes than had been expected in August, a 10.5 percent rise, and data issued Wednesday indicating that home prices fell 0.5 percent in July.
Taken together, that data show that housing – which on balance contributed to economic growth from late 2009 through the early months of 2010 – is emerging as a neutral force at best, and could drag down an already weak growth outlook.
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