lndustry will grow

duction next year. We expect housing starts to rise in 1994 and again in 195. Our projection is for 1.37 million starts in 1994, up from 1.253 million in 1993. In 1995, we expect to scart 1.41 million new housing units. Singlefamily housing starts will rival levels set during the boom years of the 1980s. Single-family production should reach a peak of 1.165 million n 1994. That's substantially more than the 850,000 begun in 1991 at the depth of the recession, and the most since 1986.

Total starts look weak in comparison to historic numbers because nultifamily production has fallen to historically low levels, from 669,000 units in 1985 to about 160,000 this year. The multifanily market has bottomed out, however, and should improve o about 202,000 next year and to V17,000 in 1995. The increase can be atributed primarily to the recent extension of the Low-Income Housing Tax Credit, which supports the production of about 60,000 rental units a year.

The remodeling market is another seclor of the housing industry that will enjoy further growth in 1994. Homeowners who have decided to stay in their homes rather than move are taking advantage of today's low interest rates by refinancing or taking out home equity loans to finance improvement projects. The remodeling market should reach arecord $120 billion in 1994, up from $113.9 billion this year. Next year's figure includes $55.9 billion in maintenance and $65 billion in improvements, additions, alterations and major replacements.

There are major unlcrowns in the picture next year, like the effecb of health care reform and availability and price of lumber. Overall, we expect the housing industry to remain one of the healthiest sectors of the economv through 1994.

global or domestic economies, our crystal ball time should be devoted to market share.

that time of year again. IEveryone

fT'S looks into that elusive crystal ball and tries to predict the events ttrat await them in the next business year. And every year, it seems, the crystal ball gets just a little more cloudy. The variables tlat could come into play are beginning to overshadow a clear view of the future for our industry.

Just a few of these would be environmental issues. consumer confidence and govemment regulations. We would also be remiss if we did not take into consideration the regional factor. Certainly areas hard hit by the economy, like C-aliforni4 have their own idiosyncrasies. Conversely, other regions in the country such as the Northeast are truly on the rise. And how long has it been since we heard about the woes in Texas?

According to Dunn and BradstreeL only 107o of businesses fail due to industry wealmess. If you look at the long-tenn projections, our industry will grow in total dollars from $100 billion n 1992 to $171 billion in the vear 2000. This is a growth of approximately 7qo per year. This along with the potential of low interest rates should offer a soli4 but not stellar, 1994.

Now more than ever, however, we need to talk about mrket share. The economic outlook tu 1994 and bevond is strong, but what about the independent hardware oriumber/building material retailer? Baning any catastrophes in

Again, l%o is what many feel the growth rate will be for 1994. What will your ma*et share be? Higher or lower? The forces of competition are sftonger than ever. My point is that it is as relevant today to predict how the pie will be cut up ils it is to look at the size of the pie.

For example, with the demise of Builders Emporium in Southern California the pie stayed the same, but there is now $500,000,000 up for grabs in market share. Similarly, other areas of the country could offer market share opportunities for the independent.

Housing stafis and forest products regulations are oitical to our industry. No one would argue with thal But a plan and an attitude to gain market share is part of a winning formula that can make the crystal ball a little clearer.

60/o gain for single family units

onstruction of single family \Zhousing is one of the predicted leaders for 1994. With a strong array of positives - geography, steady demographic supporq low mortgage rates and improving consumer confidence - single family housing will rise 6Vo rn 1994 to 1,050,000 units.

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