Five Minutes at the Builders' Show | John Burns Real Estate Consulting

Five Minutes at the Builders’ Show


Adam Grubb of Professional Builder gave me five minutes to summarize our forecast.

Click on video above to view

2018 Forecast

We have the most bullish 2018 price and volume forecast of those we track, and we are increasing our forecasts right now. Why?

  • Sales: According to our proprietary survey, new home sales rates rose 16% YOY in Q4, showing us that consumer demand is strong.
  • Land buying: Our feasibility and portfolio valuation businesses are booming, indicating that there are plenty of buyers and sellers right now.

10-Year Forecast

As we note in our book Big Shifts Ahead*, the demographics are massively clear over the next 10 years. Just look at who was renting and buying in urban areas over the last 10 years and know that they will all be 10 years older. The demand will be:

  • Entry-level buyers
  • 65+ year old home buyers as well as home sellers shifting to rental homes

Click here for more information on housing demand segmentation.

Risks

The longer the good times last and the more that home price appreciation exceeds income growth, the riskier the market becomes. That said, construction is probably the best positioned industry in the country right now. There is so much pent-up demand and so little supply. Also, builders and building products companies are so well capitalized and able to withstand a downturn that construction should be the growth story even if the US goes into a recession. We have started calling the next recession a “hiccup” rather than a “downturn,” given the industry dynamics.

 

*I am proud to announce we just authorized a third printing of 5000 books, have a 4.6 rating on Amazon, and are still in the top 50 best selling books list on urban and regional planning, demography, and forecasting. Most importantly, the feedback from our clients has been phenomenal.

 


John Burns If you have any questions, please contact John Burns at (949) 870-1210 or by email.

 

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