Housing Starts

Pablo Nuñez, a carpenter by trade, says he is accustomed to working 10-hour shifts, sometimes six days a week, on home-building sites throughout Southern California. But legally mandated overtime pay was almost as unheard of at job sites, he says, as visits from labor inspectors. "The only person getting overtime might be the brother of the foreman," Nuñez said. The Corona resident is among 85 residential construction workers from California, Nevada and Arizona who will share $242,301 in unpaid wages after settling a federal lawsuit last month against a major home-builder, Boise, Idaho-based Building Materials Holding Corp.

Groundbreakings on single-family homes held steady for the third month in a row in March, even as the number of condominium units and apartments under construction fell sharply, according to federal data released Thursday. It was the second straight day of relatively good news on the housing front and helped the Dow Jones industrial average rise 1.19% to 8,125.43 on Thursday. Shares of Southern California home builders KB Home and Ryland were both up at the close of trading.

Plans for the former Boeing Co. land north of Long Beach Airport originally called for an ambitious development that mixed office, retail and housing. But the 1,400 residences included in the massive Douglas Park project now appear to be a casualty of the sinking housing market. Developers plan to replace the homes with additional office space elsewhere on the 261-acre project site, as part of an aggressive push to bring more jobs to Long Beach.

As the housing slump worsened last fall, Don Dale struggled to find buyers for the $900,000 houses he was selling for Shea Homes in the hills of Aliso Viejo. Then in January, Shea slashed prices to about $750,000. Dale sold nine in one day. "If there is value, there are buyers," Dale said. Stuck with excess inventory, builders throughout California are beginning to offer steep discounts on new homes, sometimes at a loss. Centex Corp. is touting the "greatest prices in years" in its ads.

Construction starts on new U.S. homes rose by a surprisingly strong 8.2% in April and applications for new building permits turned up for the first time in five months, the Commerce Department said Friday in a report showing the hard-hit housing sector still had some spring vigor. Starts in April ran at a 1.032-million-unit annual rate, up from a revised 954,000-unit rate in March, and permits gained 4.9% to 978,000 a year from a revised 932,000 in March.

Irvine-based builder SunCal Cos. on Thursday pulled the plug -- at least temporarily -- on a housing development planned in rural Northern California called Bickford Ranch. The 2,000-home project in the Sierra foothills of Placer County was to be funded by Wall Street investment banker Lehman Bros. Holdings Inc., which collapsed in September. SunCal Bickford Ranch filed for protection under Chapter 11 of federal bankruptcy regulations. The filing does not apply to SunCal itself.

D.R. Horton Inc., one of the nation's largest home builders, said Tuesday that its late-2006 sales orders fell 28%, dampening sentiment that the housing sector may be recovering from a slump. The news was even worse from another builder, Meritage Homes Corp., which said net sales orders fell 42% and cancellations hit a record 48% in the fourth quarter. Housing contracts and sales of new homes have been falling for about a year after the industry enjoyed an unprecedented five-year boom.

California builders broke ground on fewer single-family homes in 2006 compared with the year before but began work on more condominiums and apartment units, the California Building Industry Assn. said. Housing starts -- as measured by building permits issued -- totaled 163,449 in 2006, a 22% drop from 2005. The total included 106,953 single-family homes, down 31%, and 56,496 apartments and condos, up 5.3%. -- Annette Haddad

A larger-than-expected drop in housing starts gave Wall Street a narrowly mixed performance Friday, but the Dow Jones industrials had their third straight record close after spending much of the session in a decline that lacked conviction. The major indexes had their best week since mid-November. Investors remained somewhat cautious after the Commerce Department said construction of homes and apartments sank 14.3% in January, the biggest drop in nearly 10 years.

Using very un-CEO-like verbiage, the chief of home builder D.R. Horton Inc. on Wednesday made clear his belief that the housing market will remain in a slump and the company will close on fewer homes this year than last. "I don't want to be too sophisticated here, but 2007 is going to suck, all 12 months of the calendar year," Chief Executive Donald Tomnitz said at a Citigroup Inc. conference in New York. "Our future is not as bright as what we would like it to be."