by Gary S. Meyers and L. Steven Platt

Wonder why there are fewer ads promoting new homes for sale? Or, why more homebuilders are going out of business? The reason is the same all across the country; no one is buying new construction. According to the Greater Chicago Market Report, a 35-year old cooperative activity report among the metro area’s homebuilders, this past week was very ugly and there is no improvement in sight.

Last week the average subdivision traffic was 2.2 families…for the week! In 2009 for the same week the number was 2.8. Sales per subdivision all of last week averaged 0.1 contracts with just 2.5 sales YTD. For the same week in 2009 the average was 0.2 contracts or 5.7 units YTD.

As bad as these numbers are, other facts point to the greater impact on the industry as a whole as well as on jobs, labor, materials suppliers, communities surviving on less revenue from builders’ permit and impact fees, etc.

When the same period of July 2010 is compared with  July 2005, the change is even more dramatic.

Item July 2010 July 2005 % Change

Number of projects 80 262 -69.47%

Traffic for week 177 4,133 -95.72%

Sales reported 10 257 -96.11%

Traffic YTD 7,738 127,001          -93.91%

Sales 568 8,421 -93.25%

Why did we give so much money to banks that failed?