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Housing Starts: Mixed Picture For Installers

1/20/2011 10:17:02 AM Eastern
Washington D.C. - The pace of single-family housing starts presents a mixed picture for custom integrators.

Single-family housing starts trailed off at the end of 2010, but the year nonetheless turned out slightly ahead of 2009's record low, Census Bureau statistics show.

Based on preliminary December statistics, the number of single-family housing starts for calendar 2010 rose 5.8 percent to 470,900 following a disastrous 28.4 percent decline in 2009 to 445,100 units, the statistics show. Despite the year's gain, the numbers were at their lowest point in the 51 years that the Census Bureau began collecting statistics (see table). And they weren't much better than the 325,000 pace recorded by the U.S. Department of Labor in 1945 during World War II.  

In December 2010, the seasonally adjusted annualized rate of housing starts slipped to 417,000 following November's 458,000 annualized rate. The year started out much stronger, thanks to federal home-purchase tax credits that expired in the spring. Annualized rates peaked at 563,000 in April and fell to a range of 433,000 to 459,000 in the following months through November.

In 2011, the National Association of Home Builders forecasts that new single-family construction will accelerate. The association forecasts 21.1 percent growth to 575,000 units in 2011 followed in 2012 by a 49.6 percent gain to 860,000. The 2012 numbers, nonetheless, will still be well below 2005's peak of 1,715,800 units as reported by the Census Bureau.

If NAHB's forecast for 2010 is any measure, however, the association might be overly optimistic. This time last year, NAHB forecast a calendar-2010 gain of 34.9 percent to 600,000, but the actual numbers turned out to be 470,900, a gain of only 5.8 percent.

NAHB's 2009 forecast, however, hit the mark. The association forecast a 25.9 percent drop to 461,000, and the final Census Bureau statistics put the number at 445,100, down 28.4 percent.

 
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