Home builders predict a combination of “demographic, economic and technological forces to significantly influence the long-term health of the home building industry and housing demand over the next decade,” according to survey data from the NAHB/Wells Fargo Home Market Index.
Surveyed builders were asked about the impact of 14 factors on the industry. The factors that builders feel will have the strongest or somewhat negative impact on housing demand over the next 10 years are as follows:
- Government debt levels: 82%
- Declining fertility rate: 78%
- Long-term inflation outlook: 70%
- Declining marriage rate: 67%
- Energy costs: 61%
Builders also identified the factors they feel will have a positive impact on the health of the industry and demand:
- Aging housing stock: 73%
- Work-from-home trends: 65%
- Artificial intelligence: 52%
- Modular and panelized construction: 45%
- Aging population: 39%
“While long-term demographic trends and fiscal pressures are viewed as headwinds, builders also see meaningful opportunities tied to an aging housing stock, evolving work patterns and emerging technologies that can offer growth opportunities and improve productivity and affordability,” said NAHB Chief Economist Robert Dietz.
“These findings underscore the complex outlook facing the housing market, as builders weigh the long-term risks alongside opportunities for innovation and adaptation in response to shifting consumer needs,” said Jason Orvosh, chair of NAHB’s Young Professionals Committee. “Especially for those builders at the early stages of their careers, these factors will shape the market for years to come and offer insights into the future of the housing market.”
Read the full report here.
