In part I of this series, we examined some new and existing home sales data setting a slightly more positive tone for the rest of 2012. In mid February, the NAHB/Wells Fargo Housing Market Index (HMI) released information that home builder confidence in the market for new single-family homes “increased for the fifth consecutive month in February, rising from 25 to 29.” In an article published by NAHB, they stated, “It is the highest level the index has reached in more than four years.
In mid march, the NAHB also released an article stating that construction spending and GDP are on the rise. Their article mentioned that, “In the fourth quarter of 2011, the Multifamily Production Index continued to show improvement, increasing for a sixth consecutive quarter, reaching its highest level since the fourth quarter of 2005. The Multifamily Vacancy Index declined for a second consecutive quarter, suggesting declining rental vacancy rates for apartment building owners.” The following graph shows the NAHB multifamily production index and multifamily start:
Of course those aren’t the only numbers we care to see rise, so we found some other numbers that will hopefully settle your stomach a bit more.
Below, take a look at the data trends in the BuildFax Residential Remodeling Index showing residential remodeling throughout the different regions in the US.
As this graph shows, all areas, with the exception of the Northeast, are showing a positive lift with Western remodelers taking the lead and looking better than ever regardless of the economy. And don’t fret, Northeast, your numbers may not be as uplifting, but they are showing a flattening, and if all goes as we’re hoping, you’ll be turning that point a notch upward by late spring/early summer.
The BuildFax Remodeling Index explains, “In October 2011, all four regions – West, Midwest, Northeast and South – had gains. The West is at a new all time high, and is up 52% year-over-year. The Midwest is near an all time high, and is up 20% year-over-year. The South is up 11% year-over-year and the Northeast was up from September but is still down 4% year-over-year.
In addition to the data and graphs, there is more reason to expect a change in the near future. There are many policies in the making. And, don’t forget…it is election year, which means candidates will be making promises through the roof in the hopes of getting elected.
If our outlook is accurate, this will require some changes on your part. Stay tuned for Part 3 where we will discuss what a possible uptick will mean for your kitchen cabinet dealership.