April New Home Sales Dip, Builder Confidence Remains up

May 24, 2018 While the demand for newly built, single-family homes increases, the sales of these homes dipped 1.5% in April, with an annual rate of 662,000 units. This follows a downwardly revised March report, which was made public by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. According to a monthly survey performed by the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), the demand for these homes rose two points in May. Builders’ confidence still remains high despite this slip recorded in the new report, and new home sales are predicted to see an upward trend regardless. The March report defines a “home sale” as the moment a contract is signed or a deposit is accepted—not when the money reaches the hands of the builders. The home can be completed, still in construction or not even started. The report also adjusted for seasonal variables, with the 662,000 units serving as an extrapolation of the number of homes that will likely sell throughout the next 12 months. On a regional scale, the Northeast saw an 11.1% increase and the South saw a 0.3% increase, while sales in the West fell 7.9% and the Midwest remained stagnant. —Christie Citranglo, editorial associate
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Builder Confidence for Single-Family Homes Rises, May Continue

May 18, 2018 Following a decline in April, builder confidence for newly built single-family homes rose two points in May, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), surveyed monthly. The HMI has reached 70, making this month the fourth time in 2018 the HMI has achieved a level of at least 70. The demand for new, single-family homes will likely continue to increase, setting a steady upward trend for the forthcoming months. A number of factors contributed to this change, including tight housing inventory, employment gains and demographic tailwinds. Lumber is still at a record-high price, which can potentially hurt builders’ bottom lines and stunt the speed at which these competitively-priced homes can be built and put on the market.  According to the HMI chart, current sales rose by two points to 76 in May. Indices measuring buyer traffic and expectations throughout the next six months were stagnant at 51 and 77, respectively. In terms of three-month moving averages in regional sectors of the HMI, the South and Midwest saw downward trends, dipping to 72 and 65. The West and Northeast remained steady at 76 and 55.-Christie Citranglo, editorial associate
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Worrying Construction Sector Watches Softwood Lumber Prices Climb

May 16, 2018

Tight supply and trading tariffs are causing softwood lumber prices to climb, becoming one of the costlier raw materials for the U.S. construction sector. Despite the recorded price decline from March to April, as seen in the National Association of Home Builders’ (NAHB) Producer Price Index (PPI) last week, many economists are finding a surge in softwood lumber prices month-over-month, including analysts from Bloomberg.

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Digitizing Data Entry Reduces Risks, Costs for Construction Industry

May 11, 2018

While some in the business credit world are staying in touch with the latest and greatest technological advancements for data collection, those in the construction industry still prefer the good old-fashioned method of manual systems. However, a new study by software company Trackvia suggests that sticking with manual data collection is both risky and costly to companies.

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Residential Construction Input Costs Rise for Fourth Consecutive Month

May 10, 2018

Building material prices for residential construction rose once again in April, marking the fourth consecutive month of increases to the U.S. Bureau of Labor Statistics’ Producer Price Index (PPI). Since January 2018, the PPI has increased nearly 4%, most recently climbing 0.9% in April.

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Construction Employment Bounces Back in April After March Decline

May 9, 2018

Construction employment maintained its positive growth rate of 3.7% over the past year after pushing forward in April with an addition of 17,000 net jobs. Associated Builders and Contractors, Inc., (ABC) released its analysis of the latest data from the U.S. Bureau of Labor Statistics, which showed a redeeming increase last month, following a steep decline in March.

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55+ Housing Market Builder Confidence Drops from Record High

May 8, 2018

Just as the National Association of Home Builders’ (NAHB) 55+ Housing Market Index (HMI) was showing substantial improvement, builder confidence in the single-family 55+ housing market took a five-point dive during the first quarter of 2018. The latest HMI was recorded at 66, falling from its record-high 71 at the conclusion of 2017.

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Nonresidential Construction Growth Still Possible, Despite March Decline

May 2, 2018

Stormy weather and job losses in the construction sector are believed to have contributed to the March decline in nonresidential construction spending, according to the latest release from Associated Builders and Contractors, Inc. (ABC). Following February’s modest gain, nonresidential construction spending declined by 0.3% in March but increased 2.5% year-over-year (YOY).

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Construction Costs Show No Slowing Down

April 27, 2018

Construction costs continue to reach new highs in the latest IHS Markit PEG Engineering and Construction Cost Index. The index increased 4.1 points to a reading of 61.8 in April, marking the 18th straight month of increased pricing (reading over 50).

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Existing Home Sales Down Year-Over-Year

April 24, 2018

Limited supply and rising prices are believed to have contributed to the latest existing-home sales numbers for March, as the National Association of Realtors (NAR) reported a year-over-year (YoY) decline despite a modest increase over February.

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