Kitchen & Bath Design News is the industry's leading business, design and product resource for the kitchen and bath trade.
Issue link: http://kitchenbathdesign.epubxp.com/i/586749
Barometers { A look at key statistics & trends shaping the industry } 8 | Kitchen & Bath Design News | October 2015 T he housing market rebound is continuing, even in the face of persistent headwinds, with new construction and residential re- modeling both gaining ground due to growth in jobs and consumer con- fdence. Among the key statistics and forecasts released in recent weeks by government agencies, research frms and industry-related trade associa- tions were the following: HOUSING STARTS Home builders are reporting higher trafc and growing confdence in the market, "and are stepping up production of single-family homes as a result," the National Associa- tion of Home Builders reported last mont h. The repor t ca me in t he wake of a government fnding that nationwide housing starts were at their highest level since October, 2007 (see related graph at right and Market Analysis below) . Al- though builders are still reporting problems accessing land and labor, multi-family production has fully recovered from the downturn, and single-family starts are improving at a slow though sometimes inter- mittent rate as consumer confdence gradually rebounds, according to the Washington, DC-based NAHB. "As job growth and consumer con- fdence continue to strengthen, the housing market should make addi- tional gains this year," said NAHB Chief Economist David Crowe. EXISTING-HOME SALES Recent increases in existing-home sales refect "what has been an impres- sive growth in activity," according to the National Association of Realtors. The Washington, DC-based NAR said last month that recent job creation, coupled with the prospect of rising mortgage rates and home prices, are "encouraging more households to buy now." NAR Chief Economist Lawrence Yun cautioned, however, that despite the recent growth in sales, declining afordability could dampen demand. "While demand and sales continue to be stronger than earlier this year, realtors have reported that listings in afordable price ranges remain elusive and are likely holding back sales from being more robust," Yun said. CABINET & VANITY SALES Sales of kitchen cabinets and vani- ties continued to post solid gains in July compared to sales for the same month in 2014, the Kitchen Cabinet Manufacturers Association said last month. According to the Reston, VA-based KCMA, manufacturers participating in the association's monthly "Trend of Business" survey reported that July sales of cabinets and vanities increased 5.0% over July of 2014. Sales of stock cabinets rose 11.2%, while semi-custom cabinet sales declined 2.2% and custom cabi- net sales increased 16.1%, the KCMA said. Year-to-date sales through July were up 8.4% compared to the same seven-month period last year, the KCMA added. APPLIANCE SHIPMENTS Domestic shipments of major home appliances, spurred by sharp increas- es in cooking products, continued to post gains in August compared to shipments in August of last year, ac- cording to the Association of Home Appl ia nce Ma nu fact u rer s. T he Washington, DC-based AHAM re- ported last month that August 2015 appliance shipments totaled 5.64 million units, up 12.0% from the 5.04 million units shipped in August, 2014. Year-to-date shipments for the frst eight months of 2015 were up 7.5% over January-August shipments in 2014, AHAM said. Housing Market Gains Continue As Third Quarter Begins Homebuilding Seen Lagging Despite Recent Job Growth MARKET ANALYSIS Washington, DC — Despite improvements in the job mar- ket, new-home construction is insufcient in a majority of metro areas and is contributing to housing shortages and unhealthy price growth, according to research from the National Association of Realtors. The Washington, DC-based NAR reported that, when comparing the volume of new-home construction to the number of newly employed workers, fndings reveal that homebuilding activity is underperforming in roughly two– thirds of measured metro areas. NAR Chief Economist Lawrence Yun noted that low inventory has been a prevailing headwind to the housing market. "In addition to slow housing turnover, lagging new- home construction has kept available inventory far below balanced levels," Yun said. "Even as the labor market began to strengthen, homebuilding failed to keep up and is now contributing to stronger price appreciation and eroding afordability." Yun said the homebuilding industry continues to face many challenges, including rising construction and labor costs, limited credit availability for smaller builders and concerns about the re-emergence of frst-time buyers. However, strong job growth and gains in single-family housing starts suggest that sustained price growth will continue to put pressure on afordability. "The demand for buying has drastically improved and is propelling home sales to a pace not seen since 2007," Yun said. HOUSING STARTS CONTINUE TO REBOUND 587 609 781 925 1,003 1,206 2 0 1 0 2 0 1 1 2 0 1 2 2 0 1 3 2 0 1 4 2 0 1 5 Home builders are reporting a higher trafc and growing confdence in the market, and are stepping up production of single-family homes as a result – a trend that's refected in the graph above. Although builders are still reporting problems accessing land and labor, multi-family production has fully recovered from the downturn, single-family starts are improving as consumer confdence and job growth gradually rebound, and nationwide housing starts are at their highest level since October, 2007. Source: National Association of Home Builders 500 650 800 950 1100 1250 1400 Seasonally Adjusted Annual Rates in Thousands of Units