Housing market looking bright

By Don Loepp
Editor

Published: February 14, 2014 1:06 pm ET
Updated: February 14, 2014 1:09 pm ET

Image By: Rich Williams

Before this year's International Builders Show in Las Vegas, I took a dive into our story archives to take a look at our coverage of the past few shows.

I spotted one headline from 2008 that was, unfortunately, right on the mark: "It's a lousy year for construction."

Fortunately, those days are over.

There was a sense of real optimism about the housing market at this year's show, which was held Feb. Feb. 4-6 in Las Vegas. And I believe the positive vibe is warranted, perhaps for the first time in a few years.

We've had some false starts the past few years on when the beginning of the housing recovery would start. But this year, economists at the show predicted strong growth. One predicted 822,000 residential housing starts — about 200,000 more than 2013.

Sure, there's still a bit of skepticism out there about the numbers. But it seemed that everyone I talked to at the show reported that they saw an uptick in business in the third quarter of 2013, and that continued in the fourth quarter. And now they're planning for continued growth this year.

That may be slow growth, for sure, and we may be several years away from the pre-Great Recession highs. But this is a market that learned its lesson from the last housing bubble. Cautious optimism is a good thing. From what I heard at the show, I won't be surprised if results don't exceed expectations.

The construction market is tremendously important to the North American plastics industry, and the fact that it's been a slacker in the sector's recent manufacturing renaissance has been a disappointment to a lot of Plastics News readers the past few years.

The siding, decking, railing, window and pipe companies — and many others — downsized during the recession and waited it out. There's been very little consolidation in those markets. Companies changed hands, but few went out of business.

What have they been doing the past few years? At the show, we discovered quite a bit.

Companies have been investing in becoming more efficient, to be sure. While they've shut down some capacity, many have purchased new lines that have them prepared for the expected uptick in sales this year.

They've also invested resources in creating new products. You'll read more about them in our upcoming special report on the construction industry, set for our Feb. 24 issue. For now, I can share that many are aimed at giving consumers beautiful homes — think "curb appeal" — as well as superior performance. And don't forget the role that plastics play in making homes more sustainable. Energy saving was very high on everyone's list at the show, as plastics help builders and consumers push the envelope of standards like Energy Star. Carbon footprint, too, is a factor, especially in the commercial sector.

After visiting the North American International Auto Show a few weeks ago, and getting a dose of positive vibes there, it was a treat to get the same feeling at the Builders show. The North American plastics industry is on a roll right now. Growth will create opportunities.

Loepp is editor of Plastics News and author of "The Plastics Blog."


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Housing market looking bright

By Don Loepp
Editor

Published: February 14, 2014 1:06 pm ET
Updated: February 14, 2014 1:09 pm ET

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