Residential construction falls to rate of 975,000
May housing starts fell to a seasonally adjusted annual rate of 975,000, 3.3 percent below a revised April 2008 rate of 1,008,000.
That figure is 32.1 percent below the revised May 2007 estimate of 1,436,000. Single-family housing starts in May were at a rate of 674,000; this is 1 percent below the April figure of 681,000.
The number of housing completions in May rose, however, 11.6 percent to 1,132,000. Still, the number of completions is 26.9 percent below a revised May 2007 rate of 1,549,000.
The number of building permits issued also fell, down 1.3 percent to 969,000, month-over-month. Single-family housing permits fell 4 percent compared with last month.
Most recently, the National Association of Home Builders announced that an index measuring builder confidence fell to its lowest level ever, to a figure of 18.
“Clearly, conditions in the housing market remain very weak, and our builder members are not seeing any signs of improvement,” said NAHB chief economist David Seiders. “Indeed, the continuing erosion of employment and consumer confidence/sentiment, coupled with surging energy costs, falling house prices and rising home mortgage foreclosures, pose considerable downside risks to the economy and our housing forecast.”
Pier 1 makes bid for Cost Plus
Cost Plus, the parent of home decor retailer World Market, has rejected an unsolicited takeover offer by Ft. Worth, Texas-based home decor chain Pier 1 Imports.
In a statement, Cost Plus executives called the Pier 1 proposal “highly conditional” and “not in the best interests of Cost Plus and its shareholders.”
Pier 1 offered about $88 million for the company, which sells casual home furnishings, decor, housewares and other home items similar to the assortment found in Pier 1 stores.
“We believe that the combination of Pier 1 Imports and Cost Plus is extremely compelling and would create significant value for the stakeholders of both companies,” said Alex Smith, president and CEO of Pier 1. “Given our similar customer bases and broadly similar business models, but distinct market positions, we believe Cost Plus is an excellent fit with Pier 1 Imports.”
Pier 1 saw several quarters of losses, but swung back to profitability in the first quarter. Cost Plus recorded losses of $32 million in the first quarter.
Correction: Tractor Supply Comps
A June 12 article in breaking news incorrectly described Tractor Supply’s comparable-store sales. The company posted a 3.4 percent increase in 2007 and a 6.5 percent decline in the first quarter of the current year.