The U.S. Department of Commerce and U.S. Department of Housing and Urban Development jointly released March 2009 building permits, housing starts and housing completion data Thursday. According to the seasonally adjusted data, the Midwest saw a 2.3 percent decline in total building-permits issued in the period from February 2009 to March 2009. Nationally, the decrease was 9 percent

On a year-to-year basis, the Midwest saw a 33.3 percent decline in building permits for March 2009 compared with March of last year. This drop was not as severe as the national decline of 45 percent in total building-permits issued in the period from March 2008 to March 2009. The Midwest was ahead of all other regions on this count, with the lowest annual decline.

The Midwest took the lead in new privately-owned housing units started, as well, with a 15.9 percent increase as opposed to a national decline of 10.8 percent from February 2009 to March 2009. In March of this year, the Midwest suffered a drop of 24.4 percent compared with March 2008, as compared to a national drop of 48.4 percent in the same month last year.

Underlying the federal numbers is ambiguity over what they project for the housing market both regionally and nationally. For example, figures reporting the March-February decline of 2.3 percent in Midwest building permits have a wide margin of error of plus or minus 12.5 percent. For housing starts in the Midwest the 15.9 percent reported increase in March-February figure has a whopping margin of error of plus or minus 58 percent.

Michael Salinsky, securities analyst for Toronto-based Royal Dominion Securities Inc. said “Unlike the West coast and Southeast, the real estate business never really took off in the Midwest, so it shouldn’t go down significantly as well. The Midwest has remained largely steady and non-cyclical unlike the other parts of the country.”

The joint release stated that the seasonally adjusted annual rate of building permits issued nationally to multi-family homes was 513,000 from 564,000 in February 2009 and 932,000 in March 2008.

The seasonally adjusted housing starts number for multi-family homes nationally was 510,000 from 572,000 in February 2009 and 988,000 in March 2008.

Stephen Cooper, statistician with the U.S. Census Bureau, said “Building permits are at a record low. Single family figures are pretty much the same as the last month but multi-family [housing] figures are down. And that’s driving the total figures down.”

Salinsky said “The cost for building a multi-family home is much more significant than the cost for a single family home. Lack of financing has really made such large investment projects difficult. Job losses too have put pressure on multi-family rents and occupancy. This decrease in demand has lead to a decrease in supply from the builder’s end.”

Thomas Mondschean, Professor of Economics at DePaul University, said “It’s a pretty depressing report. Huge inventory of houses are already in the market waiting to be sold so there’s no reason for the builder’s to issue new permits.”

Mondschean said of the potentially wide variation in the construction data: “There has always been a margin of error. They [federal government surveyors] are just being more honest than they used to be."