By now, if you read this blog you’ve gathered how important The International Builders’ Show is to the residential building industry. It’s the annual gathering of the greatest minds, brands and hands in the industry. Here you’ll find the latest in product innovations and construction technology and friends you see only once a year. And because we’re in Las Vegas, it’s sure to bring the best out of people.
Because you weren’t able to make it, we’ll bring the Show to you. Enjoy our view this week and follow us for updates, news and witty commentary, providing some insight that will get you prepared for what we expect to be a successful year ahead.
The group of economists, many of whom would consider themselves pessimists, are overwhelmingly optimistic about the future outlook of the housing market. Their projections and assessments of the market are all pretty consistent, give or take a quarter.
David Crowe, Chief Economist for NAHB, gave some convincing evidence as to why the recovery is imminent, as we’re currently at trough for single-family housing starts:
Low mortgage rates
Strong pent up demand and demographics
Significant fiscal stimulus
Some movement on practical foreclosure prevention
Significant monetary policy, traditional and balance sheet
Falling material prices
Very, very small positive signs in spending, incomes, stock market
NAHB
Here are a few of the other highlights, some things you might have already known, or guessed yourself:
Housing prices should hit bottom at the end of the year
According to Maury Harris, Chief US Economist for UBS, real GDP will begin to grow at a moderate annualized rate starting in Q3 of 2009
Fed fund rate should not rise again until mid-2010
Home sales should rebound before the unemployment rate peaks
The National Income Accounts saving rate statistic is a key factor in predicting recovery. Harris believes people are saving enough right now to aid recovery.
There should be no immediate fear about inflation. In fact, as Jim Glassman with JP Morgan pointed out, “it’s below where we want it to be.”
Housing’s drag on the GDP will slow down
Opening the credit markets is key to recovery
Mark Zandi, Chief Economist with Moody’s, believes that home sales are at the bottom and that inventories have peaked. We will work off the inventory over the course of the next 18-24 months.
The job market will stabilize this summer
Zandi projects that foreclosures will peak in the first quarter of 2010, assuming there is a lot of help that is expected
In other news, still related, NAHB showed off their new brand, with no fanfare.
