While There's Good News in Housing, Keep a Watchful Eye on the Future

March 1, 2013
Keep optimism over the good news from the housing industry in perspective, and remember that next year may prove more challenging.

Leaders need to be always aware of their surroundings and the potential impact on their organization.  Let’s take an example from current economic headlines.

I have noticed in the news lately a lot of good news about the housing industry, and the good news is deserved.  Single-family home construction in January posted a 5.6% from December.  The increase is slightly steeper than normal, and therefore very encouraging and good news for the economy.  The seasonal decline since the July high, at -24.8%, is milder than normal, so clearly there is no pending crisis in this important industry segment.

There are two things to keep in mind in the midst of all this good news.  One, a typical length of rise in the annual data trend means that the recovery in single-family housing starts will end in August 2013.  The massive stimulus spending by the Federal Reserve Board could result in a longer-than-normal rise.

Second, the 12/12 rate-of-change for single-family home construction has established a tentative high in December with more decline indicated by internal factors.  The 12/12 decline is likely an early indication of a late-2013 end to this leg of the housing recovery and a leading indicator to the slow-down we are projecting for the US economy later this year.  There is a growing optimism in the media concerning the coming year; balance that off with a tentative indication that clouds are forming on the economic horizon.

Popular Sponsored Recommendations

Navigating Disruption: A Leader’s Guide to Strategy Under Uncertainty

Nov. 1, 2023
AI, sustainability, digital--industrials are facing disruptive forces that are redefining what it takes to win. What got your company where it is today won’t get you where you...

3D Printing a More Efficient Factory Floor

Nov. 16, 2023
Today’s additive manufacturing platforms make it simple to print a wide range of high-performing industrial parts as soon as possible and right where you need them — unlocking...

Why DataOps may be the key to unlocking the full potential of digital transformation

Nov. 3, 2023
Read the 2023 market survey conducted by IndustryWeek

Process Mining For Dummies

Nov. 19, 2023
Here it is. Everything you need to know about process mining in a single book, written in the easy-to-understand, hard-to-forget style that ‘For Dummies’ manages so effortlessly...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!