Builders Praise Interest Rate Cut

Apr 18, 2001, 01:00 ET from National Association of Home Builders

    WASHINGTON, April 18 /PRNewswire/ -- The nation's home builders today
 applauded the Federal Reserve Board for cutting the target rate for federal
 funds by one-half percent, calling it "the right move at the right time."
     "The Fed is to be commended for not waiting until its next scheduled
 meeting on May 15 to make this important decision," said NAHB President Bruce
 Smith, a home builder from Walnut Creek, Calif. "Given the weakness in the
 economy and growing indications of slowing in the housing sector, the Fed's
 emergency action in lowering the cost of funds was right on target."
     He added that two key indicators of housing market strength -- NAHB's
 Housing Market Index and housing starts -- showed declines when released
 earlier this week.
     NAHB's Housing Market Index, which rates the strength of the overall
 market, dropped two points to the lowest level since January; housing starts
 declined for the second consecutive month.
     "Hopefully this will improve the outlook for housing and cushion the
 economy from any further decline," Smith said. "If the economy continues to
 slip, we would expect the Fed to again lower rates."
 
     About NAHB: The National Association of Home Builders is a Washington-
 based trade association representing more than 203,000 member firms and
 professionals involved in home building, remodeling, multifamily construction,
 property management, subcontracting, design, housing finance, building product
 manufacturing and other aspects of residential and light commercial
 construction. Known as "the voice of the housing industry," NAHB is affiliated
 with more than 800 state and local home builders associations around the
 country. NAHB's builder members will construct about 80 percent of the more
 than 1.5 million new housing units projected for 2001. During a typical year,
 residential construction accounts for about five cents of every dollar spent
 in the U.S. economy, making home building one of the largest and most
 influential industries in the country.
 
 

SOURCE National Association of Home Builders
    WASHINGTON, April 18 /PRNewswire/ -- The nation's home builders today
 applauded the Federal Reserve Board for cutting the target rate for federal
 funds by one-half percent, calling it "the right move at the right time."
     "The Fed is to be commended for not waiting until its next scheduled
 meeting on May 15 to make this important decision," said NAHB President Bruce
 Smith, a home builder from Walnut Creek, Calif. "Given the weakness in the
 economy and growing indications of slowing in the housing sector, the Fed's
 emergency action in lowering the cost of funds was right on target."
     He added that two key indicators of housing market strength -- NAHB's
 Housing Market Index and housing starts -- showed declines when released
 earlier this week.
     NAHB's Housing Market Index, which rates the strength of the overall
 market, dropped two points to the lowest level since January; housing starts
 declined for the second consecutive month.
     "Hopefully this will improve the outlook for housing and cushion the
 economy from any further decline," Smith said. "If the economy continues to
 slip, we would expect the Fed to again lower rates."
 
     About NAHB: The National Association of Home Builders is a Washington-
 based trade association representing more than 203,000 member firms and
 professionals involved in home building, remodeling, multifamily construction,
 property management, subcontracting, design, housing finance, building product
 manufacturing and other aspects of residential and light commercial
 construction. Known as "the voice of the housing industry," NAHB is affiliated
 with more than 800 state and local home builders associations around the
 country. NAHB's builder members will construct about 80 percent of the more
 than 1.5 million new housing units projected for 2001. During a typical year,
 residential construction accounts for about five cents of every dollar spent
 in the U.S. economy, making home building one of the largest and most
 influential industries in the country.
 
 SOURCE  National Association of Home Builders