MARKET INSIGHTS
Top economists shared their positive outlooks for 2021 From the ProDealer Industry Summit, forecasts for growth. By Andy Carlo
W
hat’s ahead for residential and construction in the COVID-19 era looks to be optimistic. National Association of Home Builders NAHB) Chief Economist Robert Dietz provided an uplifting outlook in regard to the near-term future of housing during the 2020 ProDealer Industry Summit. Dietz forecasts that single-family starts will rise 6% in 2020 and close to 950,000. This is a notable improvement
over previous expectations but still below the 1.1 million starts needed to keep up with demand, according to NAHB estimates. The projections are a big upswing from what the NAHB was predicting a few months ago. The NAHB/Wells Fargo Housing Market Index (HIM) reached 90 in November, which is a five-point increase over October and a data series high. In contrast, the HMI had a reading of 30 in April as the COVID-19 crisis
Single-Family Starts
Choppy conditions ahead but a growth trend continues 2,000 1,800 1,600
heightened. “Confidence now is almost off the charts,” Dietz said. High builder confidence is stemming from heavy buyer traffic, a lack of existing inventory, pent-up demand, and sales from homes that have yet to be started. In the meantime, the median new home will grow in size as more people use their homes for added purposes, including home office space. Citing Google Trends data,
Year
Units
Percent Change
2017
851,000
8%
2018
872,000
2%
2019
893,000
2%
2020
947,000
6%
2021
971,000
3%
2022
993,000
2%
1,400 1,200 80% Fall 1,000 800 600 400
Through to Current: Mar 09 = 353,000 Jul 20 = 940,000 +166%
200 0
00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
Source: U.S. Census Bureau (BOC) and NAHB forecast
30
NOVEMBER/DECEMBER 2020 HARDWARE + BUILDING SUPPLY DEALER
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