Highllights from the ProDealer Industry Summit

Highlights from the ProDealer Industry Summit

Industry innovation inspires talking points at 2021 PDIS.

Is it possible that homeowners of the not-too-distant future will have large parts of their dwelling (or maybe even all of it) delivered from a printer, instead of a building supply dealer?

The short answer, according to a presentation during the 2021 ProDealer Industry Summit, is “yes.” And not only that, these 3D-printed materials could be extruding bio-based materials that are good for the environment.

That was one of the forward looking ideas featured in the presentation, titled “Innovation & Disruption in the LBM Industry.” The presentation also looked at the concepts of modular building, cross-laminated timber and virtual reality.

Moulding samples merely hint at the disruptive potential of 3D printing.

With things moving fast, it’s hard to identify the next big thing that will alter the business. Tiffany Reeder of US LBM Holdings, product manager, interiors, described virtual reality as having a real impact today in forwardthinking show rooms.

Customers and home owners. Experience a “wow” moment, she said, when they put on their VR goggles supplied by the show room.

“The crisp incredibly real images that we can create actually make you want to reach out and turn on the faucet at the sink, or walk over and open a cabinet door,” she said. “It’s this visualization and interactivity that our customers expect.”

This selling process allows the dealer to connect with the customer, especially the younger customer.

More obstacles ahead for housing

Ivy Zelman shares her market analysis, ready or not. By Andy Carlo

If you’re a dealer who has benefitted from the surge in residential construction, remodeling and home improvement sales in the past year, now might be the time to put some money away.

That was one of the messages Ivy Zelman delivered while providing a housing forecast at the 2021 ProDealer Industry Summit, which was held in a virtual format last month.

Zelman, the CEO of Zelman & Associates and one of the industry’s top analysts, said that the housing and home improvement markets have enjoyed a prosperous run; a stark contrast to other industries hit hard by the pandemic in the past year, such as travel and hospitality.

Still, there are hurdles in the industry that include high lumber prices, a supply chain slowdown, and a labor shortage.

“While it’s challenging, I’m happy for all of my friends in the industry who have had an incredible ride,” Zelman said.

But the analyst said she sees the market reverting in the next few years.

Looking ahead, Zelman said she expects production new home orders to rise by 7% in 2021, just 2% in 2022 and fall by 6% in 2023. Zelman also forecasts single-family starts to increase 16% in 2021 and grow 4% in 2022 before dipping by 5% in 2023.

While the industry is facing a housing supply challenge, Zelman said existinghome sales should increase 10% this year. But she sees just 4% growth next year before falling by 3% in 2023.

Fueling housing supply challenges is a bottleneck of new construction along with inflation, which is forcing some builders to take a step back from new orders.

Additionally, multiple generations are remaining in their homes longer while enjoying and retaining low mortgage rates. And as home prices continue to climb, and with higher mortgage rates on the way, current homeowners are even more reluctant to leave their current residence. “Homeowners are not going to trade up for another home at a higher rate,” Zelman noted.

“I’m confident that we’ll continue to see an expansion of the virtual and augmented reality in the buying process,” she said. “We’ll likely see brick and mortar spaces shrink, while at the same time being able to actually sell and provide and sell more product solutions for the customers.”

Virtual and augmented reality tools will also play a major role in training — from forklift training to cabinet installation. “Really exciting stuff,” Reeder said.

Bryan Huot, vice president of LaValley Building Supply, agreed with the idea that modular homes have shed their reputation as inferior to traditional methods.

“The stars are kind of aligning a little more now right now for modular home construction,” he said “You have labor challenges and a lot of other macroeconomic challenges. So people are hungry for easier ways to construct homes.”

Huot drew the analogy between

At the same time, a lack of available lands and lots is holding back builders along with the rising cost of lots. Home builders are being forced to head out further and further from metro markets to new building grounds.

One of the sweet spots of new home construction, the build-to-rent market could also face challenges. Described as the “prettiest girl at the dance,” Zelman said market saturation of new single-family rentals could be here soon. “The ramp is coming,” she said.

Home improvement spending is likely to drop as well in a postlockdown economy as consumers find other avenues for spending such as travel and leisure activities as their stimulus dollars begin to run out.

Zelman said she expects home improvement spending to rise 7% in 2021 before falling 7% in 2022, marking a 14-point swing. modular home construction and OSB, which had to overcome resistance to change among builders who “only use plywood.”

There’s nothing cookie cutter about the designs of Preferred Building Systems, LaValley’s modular division. “We do modern structures, to Victorian style houses, as well as traditional New England capes, colonials and ranches,” he said. “It’s a very diverse offering.”

Think of it as “stick building within a factory,” he said. “We’re applying a lot of manufacturing techniques to introduce efficiencies to the process.”

The session on disruptive trends included a presentation from Habib Dagher, the executive director of the Advanced Structures and Composites Center at the University of Maine, site of the world’s largest polymer 3-D printer.

Dagher showed lumber dealers stop-action photography of the creation of a boat after four days of continuous printing. “You can see what is possible,” he said.

Dagher explained that the ASCC has its eyes on pushing the envelope of 3D home printing by creating a complete house that is printed completely on site.

It remains to be seen if the printed home can make a substantial dent in the housing market.

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