Inman News reports the homebuilders in California didn't take advantage of the warm January weather. "California housing production dropped about 10 percent from January 2005 to January 2006, the California Building Industry Association announced today. Housing starts (as measured by building permits issued) totaled 12,357 in January, a decrease of 1,430 units compared to January 2005."

"The total includes 9,036 single-family homes (down 10.4 percent from January 2005) and 3,321 apartments and condominiums (also down 10.4 percent from January 2005). Overall, starts were down 8 percent from the previous month of December. Single-family starts dropped 6.8 percent and multifamily starts dropped 11.1 percent."

"CBIA Chief Economist Alan Nevin said that construction is expected to pick up in the second quarter of the year. Layne Marceau, 2006 CBIA Chairman and a San Francisco Bay Area home builder, said that production is not keeping up with the demand for new homes and apartments. Marceau (blamed) a shortage of land that is 'zoned and ready to build new homes, condos and apartments.'"

"The CBIA is a statewide trade association representing about 6,500 businesses, including home builders, remodelers, subcontractors, architects, engineers, designers, and other industry professionals. A recent study determined that home-building generates approximately $60 billion a year to the California economy and creates an estimated 526,000 jobs statewide."

From the associations website. ""Once again, the construction industry was the shining star in 2005, accounting for 13 percent of all new jobs in the state. In both 2004 and 2005, one out of seven new jobs was in construction."

"In 2006, we should see a gentle slowdown of single-family construction. Riverside/San Bernardino experienced a major slowdown in new job growth in 2005, with wage and salary jobs increasing by approximately 25,000, only half the gain of 2004. It appears that 2004 was a positive aberration, but not likely to be repeated in the near future. As in each of the past four years, construction accounted for one-fourth of all new wage and salary jobs."

"2006 will be a slowdown year for San Diego, both in terms of job gains and construction. Although 2005 saw a large gain in employment, few of the gains were in the basic industries that drive the economy. Most job gains in the past year were in support jobs like retailing, local services, and local government. Of all wage and salary jobs (ones which receive W-2’s), fully one-third resulted from gains in construction."

From Hovnanian financial results yesterday. "Profits for homebuilder Hovnanian Enterprises Inc. were flat in the first quarter amid other signs that the housing market is cooling. Hovnanian saw the number of home contracts decline by almost 11 percent in the Southwest and 37 percent in the West."