Tuesday, January 8, 2013

Housing Starts to Soar, "Improving" List Grows

From yesterday's housing news:

Housing starts projected to soar

For the past few years remodelers have had an easier sell in at least one capacity: Convincing homeowners to make the most of their existing homes instead of buying new homes. Not only did builders nearly halt construction after the housing bust, but the cost-benefit analysis of remodeling vs. moving shifted in favor of remodeling, as more and more buyers of new homes found themselves holding mortgages far exceeding their homes' plummeting values.

Well, new construction is coming back this year, according to Calculated Risk's Bill McBride:
"No one should expect an increase to 2005 levels, however demographics and household formation suggest [housing] starts will return to close to the 1.5 million per year average from 1959 through 2000. That means starts will come close to doubling over the next few years from the 2012 level." -- more at Calculated Risk
The chart below shows how housing starts plummeted after 2005, and have only recently begun creeping upward again.


On the bright side, if the next surge in new construction replicates some of the quality issues of recent building booms, remodelers will have plenty to do in terms of repairs and reconstruction.

Also in yesterday's housing news...

"Improving" housing markets rise for fifth consecutive month

Housing markets are on the mend in 242 metro areas around the U.S., according to yesterday's report from NAHB's "Improving Markets Index." Launched in September of 2011 to debunk perceptions that all housing was in the toilet, the index is at its highest point since then. From NAHB chairman Barry Rutenberg:
"The story is no longer about exceptions to the rule, but about the gorwing breadth of the housing recovery even as overly strict mortgage requirements hold back the pace of improvement."
New metros on the list are geographically diverse and include Los Angeles, Des Moines, Nashville, Richmond and Cleveland.

More at NAHB.

Go to the main site of daily5REMODEL.

Go to the home page of this blog.

No comments: