Hello Readers in print and online,
Summer is in the rear view mirror, fall is looming, it’s officially the start of silly season, and my daughter is off to high school. Time sure does just fly right on by. Home building’s fortunes are still robust; NAHB reports an increase of 12.4 percent in July new home sales, to a seasonally adjusted 654,000. New home inventory has fallen to 233,000 nationwide. We are experiencing an acceleration of new home construction as housing starts rose by 2.1 percent in July, described by NAHB as a 0.5 percent increase in single-family starts, with a more significant 5 percent in multi-family starts, while townhouse construction leads the way. Home builder confidence has risen to 60. Very promising news, albeit against a backdrop of uncertainty in the country.
Our Presidential election looms large in our minds, while the Fed is consistently whipsawed by economic data that fluctuates considerably from month to month, as job growth slows and industrial inventories soften nationwide. There can be no doubt that our moribund, nascent recovery is stagnant at best. GDP growth hovers on a scant 1.5 percent from quarter to quarter. The country needs a fresh start to motivate the business community and especially our fortune 500s, who are hoarding their cash and not investing much of it.
From housing’s perspective, the first-time home buyer, largely missing in action for the past ten years, has been stymied by an unforgiving mortgage process and a scarcity of suitable product in home builder’s inventories. On the other hand, the move-up buyer, a more attractive prospect with equity, credit and cash in hand, has been well looked after by our nation’s homebuilders, seeking after all to build and sell homes to folks who can actually qualify to purchase them. As mortgage rules and interest rates continue to soften, the first time home buyer may begin to play a larger role after all. Millennials are starting families and buying SUVs in their millions.
Labor shortages in the trades continue to keep the brakes on housing. Hold on to your subs for dear life. As an industry, we really need to invest in a call to action to young folks to get involved in home building. Careers in housing are fruitful and well paid. The science of home building is making the building process, from design through construction and sales, more interesting every day. There are good career opportunities at every step. Perhaps NAHB might take the initiative and carve off a small slice of budget for a recruitment campaign? A call to arms for our industry.
On a housekeeping note, if you have not renewed your subscription to the magazine, in either print or digital format, please go ahead and do so. The process takes less than five minutes and a couple of clicks and presto, B&D keeps coming for another year. I appreciate your subscription.
Work hard, I will see you in the marketplace, or at Greenbuild in Los Angeles.