The news just continues to get worse. New home sales are down even further. Existing home sales are down even further. And to top it off, rental vacancy rates are going to hit their highest level in 28 years. This just supports my belief that we just built too many homes over the last decade. Even if we didn't have high unemployment and a credit crisis, we would have a housing problem. Unfortunately, the housing problem is becoming more than a problem. As more people are laid off, things will only worsen. Because the economy relies so heavily on home building, this recession is going to be a long one. Builders can't build and won't be able to build until this glut of homes currently on the market is filled. Even if the recession comes to an end, growth will be minimal at best. New-home sales tumble to record low pace in Jan. New-home sales tumble to record low pace in Jan. By JEANNINE AVERSA, AP posted: ONE MINUTE AGOcomments: 0PrintShareText SizeAAAWASHINGTON -New-home sales tumbled to a record-low annual pace in January and there's no relief in sight as mounting damage from the collapsed housing market pushes the country deeper into recession. The Commerce Department reported Thursday that sales fell 10.2 percent to a seasonally adjusted annual rate of 309,000, the worst showing on records going back to 1963. It also was weaker than the pace of 330,000 that economists expected, and shattered the previous all-time monthly low set in September 1981. Record Vacancy Rates Show Housing and Rental Markets Will Remain Weak | UC-IMC Record Vacancy Rates Show Housing and Rental Markets Will Remain Weak Submitted by anonymous on February 19, 2009 - 8:56pm Global News Political Economy http://www.cepr.net/images/HMM_CEPRstacked.jpg Record Vacancy Rates Show Market Will Remain Weak Homeownership rates for African Americans are below their 2000 level. The Census Bureau's data on vacancy rates in the 4th quarter of 2008 show how far the housing market must go before it can recover. The vacancy rates for both ownership and rental units increased in the fourth quarter. The vacancy rate for ownership units hit 2.9 percent, matching the record set in the first quarter. Before the collapse of the housing bubble, it had never exceeded 1.9 percent. If we assume that 1.6 percent is a normal vacancy rate for ownership units, this implies there were almost 1 million vacant ownership units. This must place enormous downward pressure on sale prices, since the owners are neither occupying the home, nor collecting rent. The vacancy rates for rental units rose 0.2 percentage points to 10.1 percent. This rate was only exceeded in the three quarters from the 4th quarter of 2003 to the second quarter of 2004. Prior to the bubble, the rental vacancy rate had never exceeded 8.9 percent. If 6.0 percent is the normal vacancy rate for rental units, then this implies that there are 1.5 million extra unoccupied units due to the slump. This should put substantial downward pressure on rents for some time to come.