In the space of seven days, to name just three of the more obvious offenses, alleged journalists at the Associated Press, aka the Administration’s Press, told us that “home construction is near a three-year high,” when it’s nowhere near there; seemed astonished that presumptive Republican nominee Mitt Romney didn’t serve up any “red-meat conservative policy” in a college graduation address; and wondered whether John Boehner and congressional Republicans are “deliberately stalling the economic recovery to hurt President Barack Obama’s re-election chances.” Oh, and it would appear that the folks at AP are coming down with a developing case of what I would describe as “thin-skin syndrome.”
The “home construction” howler of May 16 came about because AP economics reporter Chris Rugaber, perhaps with help from a colleague who has made the same mistake, seems to believe that “housing starts” and “home construction” are synonymous.
That’s wrong on two levels. First, “residential housing” includes single and multifamily units; “homes” is a word usually reserved to describe “single family homes.” Second, the housing starts statistic, while useful as an indication of where the industry might be headed in the coming months, is arguably the least important of the three items one must consider to get a handle on the current level of “home construction” for comparative purposes. The other two, as seen in the Census Bureau’s definition of “new residential construction,” are “total units under construction” and “units completed.”
So how does the current level of “home construction” as properly defined square with Rugaber’s claim that it’s “near a three-year high”? It doesn’t — at all:
- Single-family starts are indeed higher than they were three years ago. But whether you look at the seasonally adjusted figures or the raw (i.e., not seasonally adjusted) data, they haven’t even hit two-year highs in the past three months –
- The number of single-family units under construction has been scraping along at or barely above its seasonally adjusted all-time low in over 40 years of related recordkeeping for about a year. That didn’t change in April, and the number of units on which builders are working is 25% lower than it was three years ago –
- The number of single-family homes completed during the first four months of this year was also well below levels seen both two and three years ago –
To paraphrase Munchkinland’s coroner in The Wizard of Oz, Rugaber’s statement that “home construction is near a three-year high” is not only merely false, it’s really most sincerely false. If the AP reporter is unhappy with this inarguable contention, my response is: “Too bad, so sad, Chris.”