Steel Markets
May 21, 2014
Summary of the Housing Situation
Written by Peter Wright
The housing market is struggling. Even though the steel content of housing is only a small proportion of total steel consumption, housing is a leading indicator of many construction sectors, such as non-residential and sub sectors of infrastructure, and has a large multiplier effect in the economy as a whole. Existing home sales dipped again in March to their lowest levels since early in 2012. This was the 8th consecutive monthly decline.
Figure 1 shows total residential starts back to 1960 and illustrates that the current market, even after five years of recovery, is still typical of all recessions prior to the big one in 2008. Considering the population increase in the last 50 years, a true recovery is still not in sight.
