Industry Suppliers Feel the Positive Effects of an Improving Housing Market
September 10, 2013
Meetings & Events
Speaking at the Fourth Annual Window and Door Dealers Forum, held in conjunction with GlassBuild America this week in Atlanta, Hanley Wood Chief Economist Jonathan Smoke predicted housing starts would surpass 1 million next year and return to their historic levels of 1.5 million to 1.6 million starts around 2015 or 2016.
“We’ve had two years of a solid recovery after bottoming out in 2011, sales of existing homes are above their 45-year average of 4.18 million, and this is the best year for new projects since 2006,” Smoke told forum attendees. “Housing will drive economic growth going forward and create a vehicle for the entire economy to improve.”
Equally as important, the size of the average new home under construction is up 3 percent, and pent-up demand has begun to unleash both consumer spending and construction spending, he said. “Spending in construction is up 50 percent this year and will be up 50 percent again in 2014.”
In 2013, we are going to hit 949,000 housing starts, 440,000 new homes and 1,632,833 window replacements,” Smoke predicted, adding that “all those numbers will be larger in 2014.”
The supplier perspective
On the GlassBuild America trade show floor, exhibitors reported feeling the positive effects of an improving housing market.
“Business has picked up this year,” said Gary Hartman, director of marketing and new business development at Chelsea Building Products. “It picked up right in the first quarter. We saw a 20 percent improvement in new construction and overall growth in double-digits.”
“The market has stepped up nicely. There has been a remarkable difference between this year and the several years previous,” agreed Jay Campbell, sales manager, Billco Manufacturing Inc. “The market is in an upswing, and companies have decided to make investments in equipment. We really started to see the improvement this spring—as if someone literally turned the spigot on. And business has been improving steadily since,” he said. “I believe the strong sales will continue. I am certainly optimistic about it.”
Looking ahead, Filip Geeraert, president and CEO of exhibitor Deceuninck North America, said he anticipates the growth will continue as well. “We have been looking at double-digit growth this year and expect double-digit growth to continue for the rest of the year. July, August and so far September have been very strong compared to last year, with growth close to 20 percent in those months. We don’t know if it will continue, but I expect that it will. For 2014, we expect continued growth maybe in line with 2013. But the current market conditions are still fragile. We are not completely back yet.”