Gradual Upward Trajectory for Single-Family Housing
Supported by steady job growth, affordable home prices, attractive interest rates and pent-up demand, the single-family housing market should continue to grow, according to economists participating in a National Association of Home Builders Spring Construction Forecast webinar last week.
Single-family housing, which helped drive construction growth for several years, has had a very gradual recovery since the recession. According to a news release from the NAHB, single-family production will rise to 812,000 units - a projected 14 percent growth -- in 2016, following by another 19 percent increase in 2017. This would take the single-family starts to 964,000 units.
However, compared to the "healthy benchmark" of 2000 - 2003 when single-family starts were in the 1.3 million units on an annual basis, even two more years of growth and a decade beyond the bubble-burst, won't show a return to 'normal.'
Single-family construction bottomed out at 27 percent of normal in 2009. This projection takes the construction level to 77 percent of normal by the end of next year, the NAHB states.
NAHB Chief Economist Robert Dietz noted that “consumer surveys suggest the ultimate goal of millennials is to purchase a single-family home in the suburbs. We see growth for single-family looking ahead. The recovery continues and is dictated by demand side conditions and supply side headwinds.”
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