LAS VEGAS — While a record 92,064 builders and exhibitors flocked here Jan. 21-24 for the International Builders’ Show, the U.S. housing market was even more active in January. Builders began work on new homes and apartments at a seasonally adjusted annual rate of 1.85 million units in January, according to the U.S. Commerce Department. This marks the fastest pace of housing construction in 16 years, including the best single-family home production in 24 years.
“Low interest rates and healthy house-price performance remain the most important factors behind the obvious strength that single-family housing has maintained amidst generally weak consumer confidence measures,” said Kent Conine, president of the National Association of Home Builders and a home and apartment builder from Dallas. “It would be tough to maintain the super-strong building pace recorded for the past several months. But the market fundamentals remain solid, and the current level of builder optimism regarding the single-family segment reflects that.”
New single-family homes were built at a seasonally adjusted annual rate of 1.51 million units in January. This represented a 2.1% increase from December 2002’s strong number and the fastest production pace since November 1978. It also was just short of the fastest construction pace on record - 1.53 million single-family units started in December 1977. Multifamily housing starts declined 7.6% to a 340,000-unit rate in January following a big jump in December.
Meanwhile, an NAHB survey of its members confirmed that builders remain solidly optimistic about conditions in the single-family marketplace in February.
“The bottom line is that housing is holding up very well as we head toward the spring home-buying season,” said NAHB Chief Economist David Seiders. “NAHB is projecting another solid year for our industry in 2003, with a gradual leveling off of production activity as the year progresses. Our current forecast calls for 1.65 million housing starts this year, down 3.5% from last year’s exceptionally strong 1.71 million units.”
The optimism in the housing industry was apparent on the floor of the trade show in the Las Vegas Convention Center where the energy and enthusiasm of attendees were apparent. More than 1,300 exhibitors displayed products at the show, compared to about 960 last year. The booths added up to more than 714,000 sq. ft., and the total exhibit area was 1.2 million sq. ft.
The four-day Builders’ Show also was a boon to the local economy. The convention was expected to generate $140 million in revenue for Las Vegas, not including gambling. The show will return to Las Vegas in Jan. 19-22, 2004.