woodworkingnetwork.com | July 2019 | 24 |
Impacts of housing market trends
by Urs Buehlmann, Matt Bumgardner and
Karen Koenig HOUSING REPORT
on the wood products industry
This exclusive survey looks at construction market conditions and
trends to help determine what’s ahead for woodworking firms.
What’s ahead for wood products manufactur- ers involved in con- struction-based sectors
and what investments have companies
planned to improve their capabilities in
the current business environment?
To gain perspective, construction-based markets continued their growth
trends in 2018, as U. S. spending on
multi-family housing increased for an
eighth consecutive year, while spending
on new single family housing and non-residential construction both increased
for a seventh straight year, and spending
on repair and remodeling increased for
the sixth consecutive time, according to
the U.S. Census Bureau. The total value
of private construction (residential and
non-residential) put in place in 2018 was
$993 billion, up from $963 billion in 2017.
The largest percentage increase from
2017 to 2018 was in single family housing
construction, which increased by 5%; non-residential construction increased by 3%,
and residential improvements and multi-family housing each increased by 0.3%.
The number of single family housing
starts in 2018 was 875,800, representing
an increase of 3% but still well below the
peak number of nearly 1,716,000 in 2005,
according to U.S. Census Bureau figures.
Against this backdrop, the tenth
annual housing market study was conducted in early 2019 to assess market
conditions for secondary woodworking
manufacturers involved in construction-based and other related sectors. The
studies are a joint effort by Virginia
Tech, the USDA Forest Service, and
Woodworking Network/FDMC. (See “About
the Survey” on page 26.)
Sales & market trends
Analysis of year-over-year sales performance reveals a somewhat stable
percentage of firms reporting positive
changes in sales volume in recent years.
However, this was the first year where the
percentage of firms reporting a loss of
sales volume increased. For 2018, 21%
of the firms reported a decline in sales
volume, up slightly from 19% in 2017, but
still nowhere near the 81% that reported
declines back in 2009. (Figure 1). In
addition, this year’s survey found 68%
indicated a year-over-year sales increase
for 2018, down slightly from 71% in 2017.
That said, the percentage of respondents
in the Somewhat Better category (sales
up by 10%) has been trending upward
with 34% now in this category.
Single family housing and remodeling
continue to the top volume markets for