Housing starts fell 0.6% in February and permits for new construction plunged 7.8% to the lowest level in 16 years. The housing report showed February starts were 28.4% less than the level of February 2007.

Given that the enormous overhang in inventory is a huge part of the problem, this is, perversely good news.

New Home Starts

Building Permits

Continuing to add to the supply in this environment would be sheer madness.

Source:
Housing Starts – Single-Family Units Post Largest Cyclical Decline on Record
Asha G. Bangalore
Northern Trust

Housing Starts Slip While Permits Drop Sharply
JEFF BATER and BRIAN BLACKSTONE
WSJ, March 19, 2008; Page A2