Fed: New Construction Up, Demand Down (a Bit)

October 21, 2005, Wall Street Journal — New U.S. home construction surged last month, confounding expectations for a cooling in the broader housing market after two consecutive months of declines. Separately, the Federal Reserve had a note of caution on the housing sector with the release of its so-called beige book, a summary of current economic conditions. The Fed noted that while residential real-estate activity “remained generally strong,” reports that demand for homes has lessened “have become somewhat more common.” Analysts said rising mortgage rates and the prospect of overbuilding suggest that a downturn may still loom, though reconstruction of the hurricane-ravaged Gulf Coast will sustain the boom in that region.
Construction Jumps But Fed Notes Cooling [WSJ]