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Amongst all the economic indicators that can help you monitor the health of the electrical market, the increase in housing starts stuck out the most over the past month.
In its analysis of the most recent housing data, the National Association of Home Builders (NAHB), Washington, D.C., said in a press release, “Solid gains in both single-family and multi-family housing production resulted in nationwide housing starts rising 12.1% percent to a seasonally adjusted annual rate of 954,000 units in December, according to newly released data from the U.S. Commerce Department. This is the highest level of new home production since June of 2008.”
“Builders have become increasingly optimistic about conditions in local housing markets in recent months and this report underscores that the housing recovery is well on its way,” Barry Rutenberg, chairman of the National Association of Home Builders (NAHB) and a home builder from Gainesville, Fla, said in that release. “With inventories of new homes at razor-thin levels, builders are moving prudently to break ground on new construction ahead of the spring buying season to meet increasing demand.”
“Overall, this report represents a solid ending to 2012 and a promising start to 2013,” added NAHB senior economist Robert Denk. “Multi-family production is almost back to normal levels and while single-family starts still have a way to go, they are gaining momentum. This trend could be even stronger if not for persistently tight credit conditions for home buyers, flawed appraisal values and uncertainties regarding economic policy debates in Washington.”
The December flurry of activity pushed housing to a strong finish for 2012. An estimated 780,000 housing units were started in 2012, 28.1% above the 2011 figure of 608,800.
Vital Statistics
New Construction Put-in-Place ($ billions, SAAR)
Footnotes: 1 - preliminary; 2 - revised; 3 - includes residential improvements; Z - less than 0.005 percent; SA - seasonally adjusted; SAAR - seasonally adjusted annual rate. Sources: Construction Put-in-Place statistics - Department of Commerce; Housing starts - Department of Commerce's Census Bureau; Electrical contractor employment numbers and hourly wage - Department of Labor; Copper prices - Metals Week; Electrical manufacturers' shipment data - Department of Commerce; Machine Tool Orders - Association for Manufacturing Technology; Industrial Capacity Utilization - Federal Reserve Board; and Purchasing Managers Index - Institute for Supply Management.
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