Housing Starts Drop Sharply; Katrina Blamed for Some of the Downturn

Housing starts were down this month, though still considered to be in the positive zone, according to a press release by the National Association of Home Builders (NAHB). The current NAHB/Wells Fargo Housing Market Index (HMI) was released yesterday and reflected some conservative numbers in the building industry, much of it attributed to Hurricane Katrina.

"Many builders appear to be taking on a more cautious attitude because of uncertainties in the economy and this post-Katrina environment, particularly with regard to sales expectations in the near term," said Dave Wilson, NAHB president and a custom homebuilder from Ketchum, Idaho.

The overall HMI for September is a 65 and marks the third consecutive month of decline since June, during which the HMI was 72. The HMI has not been a 65 since July 2003.

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