Hardwood Floors February/March 2019

By Danushka Nanayakkara-Skillington

The unemployment rate has steadily fallen, dropping to a historically low rate of 3.7%.

Mortgage rates are expected to increase in the coming two years to more than 5%.

Single-family starts also have been supported by improving economic conditions resulting from lowmortgage rates. However, the rate of growth in single-family production has shown evidence of a general deceleration. As a result of this growth, single-family starts ended 2017 at 852,000, 96 percent above their recession-related low of 434,000 in 2011. At the same time, single-family starts are only 67 percent of the average level during the 2000 to 2003 period, just prior to the excesses of the housing boom. In other words, single-family production has benefited from economic conditions, but its current below-normal level still reflects the steep decline in response to the last recession. Underlying economic fundamentals have strengthened across the states and Washington D.C. (hereafter “states”) since the end of the last recession, but most of the leading growth states are in the western and southern regions of the country. To some degree, the strength of a state’s underlying economic fundamentals informs the extent of the recovery in single-family starts. At the same time, the pace of recovery, a return to the average level of production between 2000 and 2003, also reflects the depth of the contraction in production during the recession.

Only 56% of new and existing home sales were affordable for a typical family in late 2018.

the magazine of the national wood flooring association

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