In the News – NAHB Chief Economist Predicts 10% Growth in Single-Family Building Through 2018
Chief economist for the National Association of Home Builders, Robert Dietz, anticipates 10% growth in the single-family housing market for the next two years.
In a recent FloorDaily interview, Dietz explained that this growth is due largely to unmet demand in the current market because of tight inventory levels at present and bolstered by growth in jobs and population.
NAHB predicts that housing starts will be 1.2 million for 2017 and 1.327 million for 2018.
Dietz anticipates that multi-family building will level off, as momentum moves from multifamily to single-family construction.
“We’re looking at growth rates in the existing market of 3% to 4%, but that’s going to make that inventory issue tighter and should keep price growth in the housing market moving forward, which is good news and bad news,” said Dietz. “It’s good news for existing homeowners because it means more equity in their homes that can drive remodeling spending. It’s bad news in the affordability side, particularly for those first-time homebuyers, and we think there’s a lot more of them to come as the millennials age.”
In terms of Millennial demand, Dietz says the generation is looking for single-family homes and states that the first quarter of 2017 showed that the growth in homeowners exceeded the growth in new renters, which is good for both homeowners looking to sell as well as homebuilders. The entry-level home market is increasing, with townhouse construction, which makes up 12% of the market, growing faster, while the luxury market is slowing down.