Earlier this week the U.S. Commerce Department released
October stats indicating that new home and apartment construction have dropped
to an annual rate of 791,000 units, a 4.5% decrease from September.
Certain to receive unwanted focus is the fact that this
total is the lowest national annualized rate since 1959, or nearly a
half-century. Further, applications for housing permits dropped to an average
annualized rate of 708,000, the worst on record.
I admit these numbers are startling compared with what we
were used to seeing. With the raging mortgage crisis, skyrocketing
foreclosures, and continuing job losses, there’s no hope in sight for
construction pros. Right?
Wrong. There is hope--lots of it. Take a quick spin on the
Internet and do a search for “U.S. Population” at
. You’ll see
some drastically different numbers that I hope will bring you comfort.
In the year 2000, the U.S. population was estimated at 281
million. In 2008, our population is estimated to exceed 305 million. That’s a
whopping increase of 24 million people in eight years.
What’s more, Wikipedia reports that the U.S. Census Bureau
has predicted that the U.S. population will grow to 439 million by 2050. That
means there will be 134 million more people over the next 41 years. They all
have to live somewhere. And, except for a handful of retirees who managed to
keep their pensions intact, nobody will be leaving the U.S.
There’s even better news buried in our population numbers.
One quarter of our population (24.6%) are children under the age of 18. Sooner
or later we’re going to push these kids--once they become adults--out of our
homes. The exception, of course, is if you drop your kids off at a Nebraska hospital
Here’s what that means for the construction market. About 75
million kids will leave home over the next 18 years. They can only crash on
their friends’ couches for so long, and then they will buy a house, which will
become a home, which will need maintenance, upgrades and remodeling.
And these 75 million potential homeowners don’t include the
millions of new immigrants who still see the U.S. as the land of opportunity.
They, too, need somewhere to live.
So even though it doesn’t feel like it, demand is building
for your services. At some point, this pent-up demand will provide an explosion
of new business for architects, surveyors, builders, distributors and every
kind of specialty contractor. It can’t come soon enough.