2018 Construction Forecast
A new year is here. You’ve likely taken time to look back at the areas you’ve succeeded this year and where there are still opportunities to improve. It’s time to now look towards the future. It’s likely 2018 will bring new changes to the industry.
Last year, we predicted slow growth in the construction industry. This year, we’re expected to see more steady growth as well as a boost in the remodeling industry. Here’s what you need to know going into the new year and how you can prepare your business.
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Overall Construction Forecast
The news forecast is positive for construction in 2018, although slow growing. According to Dodge Data & Analytics annual report, there is a forecast of a 3% rise in construction starts for 2018 to $765 Billion.
“For 2018, there are several positive factors which suggest that the construction expansion has further room to proceed,” Robert Murry, chief economist for Dodge Data & Analytics, said. “Overall, the year 2018 is likely to show some construction project types register gains while other project types settle back, with the end result being a 3% increase for total construction starts.”
The report also states that the industry saw fast growth between 2012 and 2015, resulting in more modest growth these last two years.
Residential Construction & Remodeling
The outlook is good for residential construction and remodeling too. According to the Dodge Data & Analytics Outlook, single-family home starts will have a 7% increase in units, mostly due to the millennial generation demanding more single-family housing. Additionally, there will be new home starts due to the rebuilding efforts after Hurricane Harvey and Hurricane Irma.
The remodeling industry will also see growth in 2018. According to the Joint Center For Housing Studies, there is a prediction for remodeling spending to grow 7.7%, up from 6.3%, by the third quarter of 2018. They predict homeowners will spend $330 Billion on remodeling projects and upgrades within the next year. The report says that older homeowners are leading the way in this spending, as the baby boomer generation is now remodeling to age in place. Generation X homeowners are also beginning more remodeling projects as they have more money to spend after recovering from the housing crash.
If you’re a remodeling pro, you’ll be seeing some trends in the next year pop up. More homeowners are planning for the future with accessibility remodeling. Universal design and accommodations will be at the top of the list for those looking to remodel their homes. Mudroom additions and luxury basements will also be something more pros will be seeing this year.
Construction Job Growth
Jobs in the construction industry have been a hot topic in the last two years due to the skilled labor shortage. It’s likely you’ve seen headlines about this in the last year and prepare to see more of them. Although companies are stepping up now to encourage the next generation of workers, it will still continue to be an issue in the industry.
Skilled workers will be needed to fill the predicted job growth. According to the Bureau Of Labor Statistics, the construction industry is expected to grow 13% between 2016 and 2026.
It’s more important than ever to be encouraging the growth of your young employees and helping them in the trade. Consider mentoring younger workers and networking with your community to help prepare the next generation of workers.
Trends To Watch
Depending on your trade, there might be other trends you’ll want to keep an eye on this year. Last year, decking pros saw an increase in homeowners wanting to expand their decks and many wanted to also upgrade their homes for sustainability. Here’s what you’ll be seeing in 2018:
This year, homeowners will be looking to upgrade their light fixtures to make a statement. Starburst chandeliers and industrial bathroom lighting is trendy this year. Electrical contractors should be on the lookout for these hot items and understand what homeowners are looking for.
No surprise to pros, eco-friendly remodeling is still trendy. But this year, homeowners will be more conscious of choosing sustainable materials for their home. This includes flooring, appliances and even window treatments. Research what eco-friendly options are available in your trade to better assist customers.
Deep Paint Colors
Painting pros tend to see a lot of change in their field as opposed to others, as popular colors are so frequent to change. This year, homeowners are looking for deep paint colors. One of the more surprising trends to some might be the popularity of navy blue in the bathroom or the warmer, bold colors throughout the home.
Next year contractors will likely see growth for their business as well as their industry. Of course, forecasts are just a prediction. Pay attention to trends in your area to better plan the next year for your business.
Wondering what was in the news this last year? Read A Year In Review: 2017 Industry Trends.
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