Economic

The top ten most read SBC Industry News Headlines of Q3 2018 are below:

The cost index for ‘goods inputs into construction’ is now racing ahead at its fastest rate since September 2008’s +12.4%. But that elevated rate of +12.4% a decade ago resulted from an artificial boom in homebuilding that was fueled by faulty subprime mortgage lending.

Economist John Burns of John Burns Real Estate Consulting, recently shared his predictions on a rise in household formation between 2016 to 2025 that, according to his analysis, will require 1.25 million housing units to be constructed per year to accommodate it.

Although builders are slowly catching up with demand, they continue to lag behind, yet are making record profits. Presumably component manufacturers should be too.

It is becoming easier to kick start this whole home construction process and obtain AD&C loans. This upward trend in lending provides a meaningful window into future housing start trends, and thus, demand for structural building components.

Recent earnings reports from public builders like D.R. Horton, Meritage and Tripointe (as examples) make it clear homebuilders are not struggling to make a profit even as labor and building material prices have risen sharply. 

This article makes clear, the perceived “glut” in multifamily construction is likely temporary.  Rents continue to increase due to a shortage of supply of both single-family units and apartment units.

The following is an opinion piece that provides analysis and support for the argument President Trump should walk away from renegotiating the North American Free Trade Agreement (NAFTA).

A recent survey suggests new single-family home sales will increase significantly in the first half of 2018.

The housing starts report released this morning showed starts were down 8.2% in December compared to November, and starts were down 6.0% year-over-year compared to December 2016.