The US housing Sector Returning to Pre-2008 mood??!! The price of STEEL is rising...

The uptick we saw in single-family home construction toward the end of last year has abated somewhat. Nonetheless, builders reported that January, 2012 sales were above year-ago levels and traffic and inquiries have picked up. 

Sales contracts were mainly in the move-up price-point categories. Builders’ outlook for single-family construction can best be described as uncertain. 

In contrast, activity in multi-family construction and the conversion of existing properties to rental units is expected to be strong. One of our contacts noted a significant upturn in remodeling and maintenance. Little movement was seen in the list prices or discounting of new homes. A few builders commented that they would like to increase their spec inventory, but they are unable to obtain financing. Employment and wages were stable.
Activity in non-residential construction for small to medium-size contractors has improved during the past few weeks. Inquiries have shown a modest increase, and backlogs are starting to grow. 

Construction contracts were primarily with industrial and retail customers. One contact described pockets of significant activity in large commercial construction projects across the District, noting particular strength in northeast Ohio. The outlook by small to medium-size builders has brightened since our last report. 

One contractor observed that while business is slowly returning to pre-2008 levels, profit margins are still very tight compared with this point in past recoveries. 

Other than rising prices for steel and drywall, the cost of building materials was steady. 

We heard two reports about project financing being easier to obtain. Payrolls were little changed, but they are expected to rise slightly in the near future. 

Courtesy: Bloomberg.com