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Barometers { A look at key statistics & trends shaping the industry } Obstacles Hinder Sharper Housing Growth T he nation's homebuilding and buying markets continue to demonstrate evidence of signifcant growth, although a series of obstacles continue to hamstring even more robust gains, analysts said last month. Among the key statistics and forecasts released in recent weeks by government agencies, research frms and industry-related trade associations were the following: HOUSING STARTS & NEW-HOME SALES While builders "are considerably more optimistic" than they've been at earlier stages of the housing recovery, "numerous challenges" continue to thwart their ability to boost housing starts, the National Association of Home Builders said last month. In particular, the Washington, DC-based NAHB said, "limited access to construction credit, tough qualification standards for mortgage borrowers and rising costs for building materials, developable lots and labor are impacting the pace of construction activity." Despite a recent sharp dip in housing starts, the number of permits issued are "a good indicator that the dip in building activity was likely a temporary pause due partly to unseasonably poor weather conditions," the NAHB said, adding that recent gains in new-home sales are "further evidence of the gradual, consistent improvement" in market conditions over the past year. "We're now about halfway back to what could be considered a full recovery, and we expect to see continual, solid gains in both starts and sales of new homes going forward," the NAHB said. EXISTING-HOME SALES Existing-home sales, although continuing their upward trend, "remain below underlying demand because of limited inventory and tight credit," the National Associat ion of Rea ltors said last month. Lawrence Yun, chief economist of the Washington, DC-based NAR, said the housing market is solidly recovering "in spite of tight access to credit and limited inventory. Without these frictions, existing-home sales easily would be well above the 5-million unit pace," Yun noted, adding that buyer trafc is 31% stronger than a year ago, but sales are running only about 10% higher. Existinghome sales are at the highest pace since November 2009, when the market spiked to 5.44 million units in response to the homebuyer tax credit. Total sales have been above year-ago levels for 22 consecutive months, while prices show 14 consecutive months of year-over-year increases, the NAR said. THE CONTINUED GROWTH IN SALES OF CABINETS & VANITIES PERCENTAGE OF GROWTH OVER THE IDENTICAL MONTH A YEAR EARLIER JULY, 2012 AUGUST, 2012 SEPTEMBER, 2012 OCTOBER, 2012 NOVEMBER, 2012 DECEMBER, 2012 JANUARY, 2013 FEBRUARY, 2013 MARCH, 2013 APRIL, 2013 + 8.6% + 10.4% + 2.0% + 18.4% + 15.0% + 7.3% + 17.4% + 14.1% + 13.7% + 18.8% UP 18.8 % APRIL 2013 Refecting growth in the nation's housing market and remodeling sectors, sales of kitchen cabinet and bathroom vanities have been up for the past 10 months, through April of 2013, compared to the identical month a year earlier. Year-todate sales through April are up 16.2% compared to the same four-month period last year, the KCMA reported. APPLIANCE SHIPMENTS Domestic shipments of major home appliances were essentially fat in April compared to shipments during the same month in 2012, according to the Association of Home Appliance Manufacturers. The Washington, DC-based AHAM reported last month that April appliance shipments totaled 5.20 million units, down 0.9% from the 5.25 million units shipped Source: Kitchen Cabinet Manufacturers Association in April, 2012. Year-to-date shipments were up 3.4% for the frst four months of 2013, compared to January-April of 2012, AHAM said. Sales of kitchen cabinets and vanities continued to post significant gains in April, rising 18.8% compared to the same month in 2012, 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 sales of stock cabinets rose 24.3%, while semi-custom sales gained 14.8% and custom cabinet sales increased 12.8%. Yearto-date sales through April were up 16.2% compared to the same four-month period last year, the KCMA reported (see related graph, above). growth this year," reported AIA chief economist Kermit Baker. "The housing market has seen such strong growth over the past year that the greatest industry concerns at present are on the supply side: whether there is sufficient construction labor, construction materials availability and prices, and land shortages in rapidly growing markets," Baker added. While project delays are standard in the architecture profession, most frms believe that the situation has gotten worse recently, with uncertain economic conditions and client difculties in obtaining fnancing playing a role, the AIA noted. Almost seven in 10 architecture frms surveyed by the AIA feel that project downtime has increased in recent years, with half of those indicating that it has increased a lot. Less than 6 percent of firms report that project downtime has decreased in recent years. Architecture firms are also reporting that recent projects have been smaller on average, and have a shorter design phase than typical projects during the last construction boom, the AIA noted. CABINET & VANITY SALES MARKET ANALYSIS Housing Growth Seen, Although Obstacles Linger On Supply Side 8 | Kitchen & Bath Design News July 2013 Washington, DC — Architecture frms concentrating on the residential sector are still reporting growth, although the pace of that growth "has slowed dramatically" over the past two months, the American Institute of Architects reported last month. Even with sequestration as a factor, the general strength in the housing market points to a healthy recovery, the Washington, DC-based AIA said. "Housing starts increased by more than 25% nationally in 2012, and the consensus is that we'll see comparable