Single-Family Starts Forecast to Advance 28 Percent in 2013
August 13, 2013
McGraw Hill Construction forecasts a six percent climb in total new construction starts for 2013, with single-family housing advancing 28 percent in dollars or 24 percent in the number of dwelling units, to 640,000. The inventory of new homes for sale is currently very low, which should spur more construction, McGraw Hill predicts in its Aug. 12 Midyear Update to the 2013 Construction Outlook. Home prices are increasing, and although the recent increase in mortgage rates has raised concern, rates remain near historic lows and have not significantly affected affordability for most potential homebuyers, MHC reports.
Looking at the overall new construction market, housing continues to lead the upturn, accompanied by modest gains for commercial building and public works, with institutional building continuing to retreat, according to the report. This is the same rate of increase for total construction starts McGraw Hill predicted last October, and follows the 8 percent gain in 2012.
“The recovery for construction continues to unfold in a selective manner, proceeding against the backdrop of the sluggish U.S. economy,” says Robert A. Murray, VP of economic affairs for McGraw Hill Construction, in the report. “On the positive side for construction, the demand for housing remains strong, market fundamentals for commercial building are strengthening, and lending standards for commercial real estate loans continue to ease gradually. On balance, the recovery for construction is making progress, but at a single-digit pace given the mix of pluses and minuses by major sector.”