Housing Projected to Lead Construction Growth in 2014

Industry report predicts growth of 9 percent in US housing starts

According to the 2014 Dodge Construction Outlook report from McGraw Hill Financial, 2014 is looking up for construction contractors. A vice president from McGraw Hill characterized the coming months as a period of “measured expansion” for the construction industry. Despite ongoing economic uncertainty and federal spending cutbacks, McGraw Hill analysts expect low interest rates, an improved lending environment, and sluggish but perceptible job growth to contribute to an overall 9 percent increase in US construction starts. Considering that last year’s estimate was just 5 percent, this seems like a positive outlook indeed.

Housing Growth Vital

Much of the growth in new construction starts is expected to come from housing projects. Revenue from single family housing is projected to grow 26 percent, while multifamily housing should manifest an 11 percent increase. New single family homes are considered a smart development project because of rising home prices, low mortgage rates, and falling foreclosure rates. Multifamily developments are projected to grow as well because this type of development is a favorite investment vehicle for the real estate finance community, and because the market for multifamily housing is considered to be maturing.

Commercial Building Also Significant

Analysts predict commercial building will increase 17 percent, which is a bit better than the 15 percent estimated for last year. Warehouses, hotels, office buildings, and stores should lead the growth. Banks seem especially eager to extend loans for commercial development.

Institutional Building Makes Minor Gain

Institutional building, such as hospitals and schools, may grow 2 percent. This is the first time in 5 years that positive growth has been projected for institutional building, thanks in part to the fact that some states have passed construction bonds to fund these projects and make up for reduced federal spending.

Public Works & Utility Projects Drop

Public works and utility construction, once a staple for contractors, are both projected to drop in 2014. Public works such as highways and bridges will drop 5 percent, while electric utility construction will drop 33 percent.

Are You Ready to Take Advantage of this Growth?

Obviously projected growth in the construction sector is good news for contractors and construction workers alike. But are you ready to take advantage of this growth? Grove Construction Hardware can help. We have a complete range of construction supplies and tools, as well as some types of construction materials and safety equipment. Come visit our store or place a special order by phone or online to make sure you are fully stocked up and ready to take on new projects.