The housing industry in the United States of America has also been hit by a major recession. The figures are the lowest in the last seventeen years. According to official data since last July there has been a drop of almost eleven percent. During this period the whole sale inflation also rose by almost 1.2 percent. The sale of new houses came down to 647,000 units in the middle of housing sag that has resulted in a hike in foreclosures. There was a drop in housing starts and building permits from the beginning of 2007. Permits are a significant indicator of the industry. This number of permits can forecast of what is to come in the future. The numbers of permits have gone down by almost 7.8 percent. This is like showing the red flag for the housing industry.  This has also brought down the Dow Jones Industrial Average down 131 points to 11,349. According to Craig James, chief economist of CommSec says that the US is in mild recession. Most of the US economy is weak. Unemployment is on the rise and every where there is recession.

Robert Shiller, Professor of Economics at Yale University, has said that Losses that rise from the housing recession in the country could triple in the coming years and this will be the most significant threat to growth of the United States. The American housing industry has almost lost to a tune of one trillion dollars. This figure can triple in the coming few years. Recovering from such kind of loss will be very difficult. This kind of recession can prolong for many years as one can see that in the next five years, the futures contracts are pointing to losses of around 35 per cent in some areas, such as Florida, California and Las Vegas.

It is very much similar to the classical bubble scene. A few years ago the price of the houses went very high mainly because of investors prospects. The people of the country thought that the prices would only rise and never come down.  Now there is a chance of this bubble bursting and the country heading for a big recession in the housing industry. According to Mike Larson, chief real estate agent analyst of Weiss Research, Single family is the nucleus of the housing market and they are failing to make a mark in this industry. The housing construction market is very weak. There are no new levels of start to keep in with the demand. This has put a considerable pressure on the housing market.

In the beginning of the year 2007, there was much activity in the housing industry. Many states experienced prolong housing boom high prices fuelled by cheap credit and slipshod lending practices to borrowers who otherwise would not have been able to procure a mortgage. The trend began to slide very soon. This slide has been experienced by all the states across the country.