Supply Chain Connections

Jun 2 2009 10:12AM | Permalink | Email this | Comments (0) |
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By Glenn Singer

Last week I attended the National Association of Home Builders' spring board of directors' meeting in Washington, DC. What I heard and experienced left me with mixed emotions in that I heard "the good, the bad and the ugly."

Let’s get "the bad and the ugly" out of the way because there is some "good" to talk about. So here is the bad news. 

• Housing starts at an all-time low with less than 400,000 single family homes being constructed this year. 
• Commercial construction is declining. 
• Booth space rentals for the 2010 IBS are way, way down. 
• NAHB staff has taken a 5 percent salary reduction and will take a 10-day furlough later this year. 
• Membership levels are dropping as well. 
• Attendance at the meeting was way off too.

OK, now for the good news.

• Most of the pendants and experts have declared that the homebuilding market is on the bottom and will begin rising slowly on a market-by-market basis. 
• The stock market is slowly regaining strength. 
• NAHB senior staff is doing a good job of facing reality and adjusting strategies. 
• Most of the builders that I talked with at the meeting were hanging on and expect to survive the mess that we are in. 
• New home inventories are finally shrinking. 
• Foreclosure inventory is shrinking as well.

The bottom line is that I believe the heart beat of the home building industry is strengthening and that we will come out of this mess a lot stronger as individuals and as an industry.