Builders On Track To Build Largest Number of Homes in Four Years
According to a New York Times article, builders are on track this year to start work on the largest number of homes in four years. Builder confidence rose in December to a seventh straight month to the highest level in more than 6 ½ years, with the pace of home construction nearly 22% higher than this time last year.
Because of rising sales combined with a decline in the supply of available homes, home prices had their largest year-over-year increase in 2 ½ years. Even more impressive is the benchmark from 2 ½ years ago against which this is measured is when the home buyer tax credit provided an artificial impetus to increased sales. Therefore, when compared against normal market forces, current home sales and consequent home construction is better than it’s been in many years.
Those of you in residential construction are already likely seeing at least a modest improvement in work loads. Those of you in commercial construction have reported increased work as well. We’re certainly nowhere near the levels we enjoyed six years ago, but the prospects for at least a slow and steady improvement in construction look good. As long as Washington doesn’t foul things up by discouraging business plans through tax increases and excessive spending cuts.