Just Another Bit Of Good Housing News

...or not.

New U.S. housing starts and permits plunged to record lows in November, as long-standing problems in the housing market continued to weigh on the U.S. economy, a Commerce Department report showed on Tuesday.

Housing starts fell 18.9 percent to a seasonally adjusted annual rate of 625,000 units from 771,000 units in October.

That was much less than the 740,000 starts Wall Street analysts expected to see for November.

New building permits, which give a sense of future home construction, plummeted 15.6 percent to 616,000 units from 730,000 units in October.

That was also much below Wall Street analyst estimates of 700,000.

That's a massive drop in numbers even from just October. The bad part is if housing starts pick up faster than housing prices do...it will depress prices even further. I don't see how that could happen other than housing companies jumping the gun and building early 2009 in order to "get in on the ground floor of the new housing recovery".

It doesn't make any logical sense. Then again, the US economy has been operating on that whole "lack of logical sense" thing for the last several years, especially in housing. If people see these record low new housing starts and permits as the bottom of the market rather than a price-based bottom (which is still nowhere in sight), things could get even worse in the housing market.

American consumers aren't that dumb, are they?