February 2017
Home Show 2017 – page 2 Kansas Legislative Day – page 3 NAHB’s 2017 Leadership – page 4
Economic Forecast for 2017: Positive Growth Expected January 25 was a cold morning… but a tasty breakfast and intellectually stimulating conversation helped warm things up at KCHBA’s annual Economic Forecast Breakfast. Robert Dietz, chief economist and senior vice president of economics and housing policy for NAHB was first to present to an audience of more than 200 attendees. Chris Kuehl, managing director of Armada Corporate Intelligence followed up with his assessment of the top developments in 2016 and his outlook for 2017. Dietz reported that the general theme of the NAHB forecast is that there will be continued growth in home building, but the rate of increase has been reduced from earlier forecasted growth due to supply side limitations. Specifically, the limitations are the lack of the 3 L’s: lots, labor and lending. Labor, in particular, is reducing builder activity as the labor shortage is worse now than during the peak of the boom.
HBA’s Lookback Continues – page 16
Dietz predicts an increase in the demand for single family housing. Part of this is result of the continual economic growth during the past four years and the fact
that wages have begun to rise. The older members of the millennial generation have slowly started to move into the housing market and Generation X is now hitting their home buying peak. Builders will be faced with an increase in building material prices, according to NAHB’s forecast. Lumber and concrete prices will continue to rise along with a slow increase in the price of gypsum. Dietz expects the results of this presidential election to impact the economy in various ways, some of which include higher spending—resulting in a larger deficit and increased interest rates on mortgage loans. Kuehl expanded on the lack of labor availability and the consistent decrease in labor force participation. He stated
that there are shortages in construction, manufacturing and other fields summing up with: “we don’t need to create jobs, we need to fill the ones we have.” Filling these jobs will require a new direction in education for many schools and students—currently only a small percentage of secondary schools teach industrial art coursework.