An economic outlook released today by Global Insight predicted that construction of new homes in the United States this year will dip to the lowest levels since World War II. One of the main problems: Financing. According to the Global Insight release, “Many regional banks, which homebuilders depend on for financing, are running into problems because of rising delinquency rates. Even banks with solid balance sheets are reluctant to finance any project related to housing.”

Construction is off locally. In the second quarter, which includes all of April, May and June, permits issued to build houses (excluding condominiums) in the county dropped by 53.9 percent compared to the same period last year, according to statistics provided this afternoon by Bill Riley, vice president of government affairs for the Washington Realtors and an owner of GMAC Real Estate in Puyallup. For some additional perspective, I wrote in May about local builders leasing unsold homes, rolling out the incentives and slowing construction as they grapple with today's market.