A slight slow-down is of no concern if we continue improving our practices
By ABBY PITTMAN
Welcome to our February issue of Builder and Developer Magazine. This month, we have the pleasure of attending the industry’s largest show of the year: the International Builders Show. For this show, we have put together an extra special magazine for your enjoyment, with an added 30-something pages.
The thickness of this magazine, I believe, works on two levels: metaphorically and physically. Yes, it is a larger magazine than you are used to seeing, but also, the thickness of the magazine is a reflection of where we stand as an industry. We did not go out seeking extra pages. The extra pages found us. You found us!
There are so many amazing, beautifully photographed developments out there, and you all had so much to eloquently say, how could we not add pages to encompass the vast scope of what this industry has to offer?
By the end of 2018, confidence in our beloved industry had wavered a bit. Wall Street was doubting us, which unfortunately made us doubt ourselves, despite the facts that were often presented to us.
- New home sales rose an additional two percent last year, and it is projected to grow again this year.
- Unemployment rates are about to be at an all time low, which is a great reflection of the market.
- The largest group of buyers – millennials – is just now moving into the market.
Chief Economist for CoreLogic and Builder and Developer Magazine columnist Dr. Frank Nothaft discusses the new-home market outlook for 2019: “We anticipate economic growth will be about 2.1 percent during 2019, sufficient to push the unemployment rate down to about 3.6 percent. This would mark the lowest unemployment rate in 50 years and generate more wage and income growth. As of November 2018, the Federal Reserve Bank of Atlanta Wage Growth Tracker reported wages up four percent over the past year, and growth may accelerate as the labor market tightens further in 2019.”
“We forecast a three percent rise in U.S. new home sales during 2019, placing sales at their highest level since 2007. Most of the increase will be in the South and West, with the Houston and Dallas metropolitan areas again topping the list for new-home sales.”
Another one of our columnists, Greg Vogel, CEO and Founder of Land Advisors, also touched on the continuous growth and durability of the market, but mentioned the cautiousness that homebuilders are presenting.
“The growth, strength, and durability of the US economy will continue to fuel a healthy land market, but the looming signs of a slowdown will keep builders, developers, and investment capital cautious in the coming few years,” Vogel said. “The caution being exercised will lead to a less violent down cycle and, most agree, whatever recession is looming will be much kinder to land and housing this go around.”
Homebuilders, congratulations! You have done, collectively as an industry, what so many other people (politicians) failed to do – you learned from history. You learned from history, and took into account all the lessons and the hard times you faced back in 2008 when we came to a painfully screeching stop, and have taken steps to ensure that that will never happen again.
My advice? Do not stop learning. Sure, the worst is behind us, but in front of us is a whole new set of buyers with a whole new set of wants and needs and expectations. Some of you may be averse to change, but evolving is what will continue to keep your company on top, and buyers to keep referring their friends.
Regular Contributor and Principal with MetroIntelligence Real Estate Advisors’ Patrick Duffy discusses the necessity of implementing technology into your sales tactics. “After many years of impacting the fields of retail, travel, stock trading, and others, technology is now increasingly poised to change how both new and existing homes are bought and sold,” Duffy writes. “While there will probably always be a market for traditional agents, only those with area expertise and excellent customer service will survive in this new marketplace.”
If we are facing a potential slowdown, or even if we are trying to curb a slowdown before it begins, evolving sales tactics and building tactics is the most surefire way to ensure continual growth. By continuing to improve and implement new ideas and new technology, we can create growth instead of staying stagnant, and I know you all are capable of it because I see it in your submissions! This magazine, with its plethora of industry leaders, and beautifully showcased and cutting edge projects, proves just how robust and capable this industry is. Keep up the hard work and have confidence in the resilience of this industry, and I hope to see all of you at IBS!
Abby Pittman is the Editor for Builder and Developer Magazine. She may be reached at email@example.com