The nation’s infrastructure is an imperative for its health. That’s why PSN parent company Hanley Wood is holding a conference to discuss this issue. To support the conference, called “The Infrastructure Imperative,” the magazine Concrete Construction has been running a series of Q&A’s from luminaries on the topic. This one discusses the housing market as well as infrastructure, so we thought we’d share it.
Some highlights regarding housing:
CC: What regions hold the most promise in terms of housing growth?
Mark: Inland markets of California (like Sacramento and Inland Empire); select Florida markets (such as the suburbs of Miami, Fort Lauderdale, Orlando, Daytona Beach, and Tampa); Atlanta; select Midwestern markets (including Cincinnati, Indianapolis, Kansas City, and Minneapolis); and San Antonio.
Markets currently on fire will continue to experience enormous growth, but at a much greater risk of a correction. These include Austin, Dallas, the Greater Denver region (especially northern Colorado), Wasatch Front (Utah), Phoenix, and Las Vegas.
CC: “Correction”? That doesn’t sound good.
Mark: Housing is cyclical. When the next downturn occurs, these particular states are hanging out there with very high prices and very high supply. They’re primed for a major correction.
Other states, like Florida, aren’t necessarily overpriced. Inland California is in a good position because it’s not oversupplied, nor will it be.
But yes, some states are setting themselves up for a big correction. They’ll be a victim of their own success, whereas other states will have a much softer landing.
CC: How do today’s housing trends bear on public infrastructure?
Mark: Funds will skew toward areas of highest population growth. All the above states will attract public infrastructure, but 80% of future spending must come from the states. Again, those most responsibly managed will be in a position to benefit from the federal priming of the fiscal pump.
States in the best position, that will also build lots of homes in future years, include Florida, Indiana, Nevada, North Carolina, Ohio, Utah, and Virginia.
CC: What’s your 30,000-foot assessment of the lending arena?
Mark: Lending will continue to ease for both builders and buyers – not anywhere close to the lax lending standards of the last cycle, but lending competition is increasing.
Mortgages for first-time buyers have been very challenging in this cycle thus far. To keep the cycle going, we need to shift the focus to them. Most are now established in their jobs, they’ve made headway in paying off debt, and they should be able to join the party.
The market is a bit top-heavy now, with far too little housing construction for entry-level homes and far too much for executive move-up and luxury homes.
Don’t miss the opportunity to hear Mark’s full perspective and what the trends mean for your 2019 budgetary decisions. Secure your seat for the Infrastructure Imperative now.
