Coming down from its best year ever, the vinyl building and construction market finally is expected to level off and maybe even take a slight downturn this year, analysts predict. Home ownership is at an all-time high, the unemployment rate is at its lowest point in recent times and the economy continues to soar. It doesn't get much better.
However, all good things come to an end. The rising stock market likely will level off, thanks to an interest rate hike handed down by the Federal Reserve, which should hamper growth in the construction industry, predicted Maury Harris, chief economist for PaineWebber Inc. in New York.
But what does a stale construction and remodeling market mean to vinyl manufacturers? Not much.
In fact, if sales are stable in 2000, it might not be all bad, said David Seiders, chief economist and senior vice president of the National Association of Home Builders.
The cries are all the same.
Manufacturers cannot keep up with increased orders because good laborers are scarce. All the desirable employees already are taken, he said.
"Some slowdown is not something we would view as evil," Seiders concluded.
Maybe not, but many manufacturers are optimistic and even expecting their own sales to rise. And many have the same battle plan: to capture more market share.
Rather than relying on new construction, MI Home Products Inc. of Gratz, Pa., plans to shift its focus more toward replacement vinyl windows, said Mike Jackson, vice president of sales.
Remodeling is the star that is expected to continue to shine in the industry. Because, said Lee Meyer, president of Variform Inc. of Kearney, Mo., it is aimed at middle- and upper-class homeowners, who can more easily afford it.
For that reason, Donald Kaufman, president and chief executive officer of Alside, said his Cuyahoga Falls, Ohio-based company plans to rely on remodeling to carry it through 2000, rather than new home construction.
Further increases in interest rates likely would cause people to back off of building a new home.
"The Fed is going to pick on the housing sector because it's still rate-sensitive," predicted David Lereah, chief economist and senior staff president of the Mortgage Bankers Association of America.
"Your next year won't be quite as good as this year but it'll still be a pretty good year," Harris said.