Government report shows surprising sharp drop in housing starts in April. Building permits also plummet to record low.

Pulte Homes Inc. is buying Centex Corp. for $1.3 billion in stock in a deal that will create the nation's largest homebuilder that caters to everyone from first-time homebuyers to grandparents looking to move into retirement communities.
The acquisition also will give Pulte large tracts of land in Texas and the Carolinas, two of the most resilient real estate markets, and a presence in 29 states and Washington, D.C.

After a multiyear string of busts, home builders are hoping sales may show a flicker of life in 2009 during the all-important spring selling season that unofficially kicks off the weekend after the Super Bowl.