WASHINGTON — Anirban Basu, chief economist, Associated Builders and Contractors (ABC); Kermit Baker, chief economist, American Institute of Architects (AIA); and Robert Dietz, chief economist, National Association of Home Builders (NAHB) recently predicted continued growth for the construction industry in 2017 during a joint economic forecast.
“Nonresidential construction spending growth will continue into the next year with an estimated 3-4 percent increase,” said Basu. “Growth will continue to be led by privately financed projects, with commercial construction continuing to lead the way. Energy-related construction will become less of a drag in 2017, while public spending will continue to be lackluster.”
“Our forecast shows single-family production expanding by more than 10 percent in 2016 and the robust multifamily sector leveling off,” said Dietz. “Historically low mortgage interest rates and favorable demographics should keep the housing market moving forward at a gradual pace, but residential construction growth will be constrained by shortages of labor and rising regulatory costs.”
“Revenue at architecture firms continues to grow, so prospects for the construction industry remain solid over the next 12-18 months,” said Baker. “Given current demographic trends, the single-family residential and the institutional building sectors have the greatest potential for further expansion.”
Each economist discussed leading, present, and future indicators for sector performance, including ABC’s Construction Backlog Indicator (CBI), AIA’s latest Architecture Billings Index (ABI), Construction Consensus Forecast, and the NAHB/Wells Fargo Housing Market Index (HMI). An archived version of the web conference is available at http://bit.ly/2bey4pu.
Publication date: 9/26/2016