Private Housing to Lead Construction Growth in 2018
It’s no surprise with the recent headlines of natural disasters that the supply and demand for private housing is predicted to rise for 2018. Tens of thousands of homes in Texas, Florida, California, as well as the US territories of Puerto Rico and the U.S. Virgin Islands were dramatically impacted by fires and hurricanes. These disasters have displaced thousands of families. The need for new housing is immediate.
Eye on Housing predicts a growth trend of around 10% in 2017-2018, similar to recent years. As younger homebuyers enter the market, the need for affordable housing is evident. Some areas of the US, such as Portland and Seattle, have more demand than supply, driving the price of homes to an inaccessible amount for a first-time buyer. Washington and Oregon have led the US on rising margins in housing prices for 2017.
Things look worse when you consider that the Millennial generation typically has an abundance of student loan debt, tends to settle down to start a family later than previous generations, and may not be in a financial situation to buy a home, depending on their salary versus the cost of living in their chosen city.
During the financial crisis of 2008, housing prices bottomed out. Over the next few years, there was a slow climb back to normalcy. Currently, 28 states have rebounded and home values are finally at a higher value than before the crisis hit.
Despite political upheaval within the country since the change in leadership, stocks and the economy have remained relatively stable and shown steady growth. The housing market is no exception. New home sales are predicted to reach about 8% in 2018, according to The Professional Warranty Service Corporation.
Several areas of the U.S. continue to grow and prosper, leading the arena of economic growth. Seattle, Denver, Austin, Charlotte, and Bend (OR), all rank in the top 5 for fastest growing cities within their category of small, medium, or large city. Trends show that younger people continue to favor living in cities where there are more job opportunities, while older Americans retire to a larger plot of land in a suburb or more rural location.
The economic forecast for 2018 looks promising. This will drive home sales up, especially in rapidly-growing cities across the US. As building and rebuilding are set to increase, the construction industry and other sectors are looking strong as they head into the New Year.