b"YOUR TOOLKIT FOR BUILDING EXCELLENCEexisting homes remains well below the four to sixbecausetheysimplydon'tpenciloutanymore.months of inventory that is considered a balancedConerlyadviseskeepinganeyeoutfortwo housingmarket,notedYaros.Strongdemandstatisticsthatmightindicateapending caused a 10.3% increase in the median price fordownturn.Oneisanyincreaseininitialclaims existinghomesin2022,anda0.6%increaseinforunemploymentinsurance.Anotherisan 2023. A correction of 1.1% is expected in 2024. inversionoftheyieldcurve,inwhichshort Foranexplanationofthescarcity,looknoterminterestratesexceedlongtermones.furtherthantherun-upinmortgagerates.TheWhatevertheconditionofthetealeaves, ultra-lowinterestratesofexistingmortgagesbusinessesingeneralwillencounteratougher amount to a strong financial incentive for existingoperatingenvironmentin2024,characterized homeownerstostayput.Currenthomeownersbyaneedtofinesseatightlabormarketand hadrefinancedtheirinvestmentsat3%or4%,reluctantlenders.Inthecomingyearwewill noted Bill Conerly, Principal of his own consultingfaceuncertaintyaboutinflationandinterest firm in Lake Oswego, Oregon (conerlyconsulting. rates,shortagesoflabor,higherenergycosts,a com).ReplacingwhattheyhadwithbetterslowdowninChinaseconomy,andrecurring homeswouldrequirewalkingawayfromthosethreats of a federal government shutdown, said mortgagestotakeonnewonesat7%.IthinkPalisin.Therearealotofspinningplatesin wellseethistrendcontinueforanotheryear,theair,andsomeofthemmayfallandcrack.butIthinkwe'llalsoseealotofstrengthin remodeling,andthatwillbefinancedprobablyPREPARE FOR A SOFT LANDINGwith home equity lending or second mortgages. U.S. Gross Domestic Product Keeping watch (GDP) Annual % ChangeIn the opening months of 2024, economists are2014: 2.3%advising construction companies to keep an eye on some key statistics to get an idea of how the2015: 2.7%yearwillturnout.Oneleadingindicatorthe2016: 1.7%construction companies should look at is the level2017: 2.2%of permits issued for various construction activities, whether they are single family homes, apartments,2018: 2.9%ornon-residential,saidBasu.Anotherwould2019: 2.3%betheArchitectureBillingsIndex,whichisa reflectionofarchitectactivity.Ifthearchitects2020: -2.8% andengineersarebusyupstream,itmeans2021: 5.9%contractors will more likely be busy downstream. 2022: 2.1%Whileconstructioncompaniestendtofocus onmaterialsprices,whichhaverecentlybeen*2023: 2.1%roughly flat, Basu said that the cost of money has*2024: 1.4%amuchgreatereffectonthebottomline.PayEconomists predict slowing growth closeattentiontowhatFederalReservepolicyfor 2024.makers are saying about inflation early in 2024, andassesshowthatwillaffectinterestrates,Sources: World Bank; *= projections whicharealreadysohighthattheyforecloseby Moodys Analytics.the possibility of many projects moving forwardFRAME BUILDER - NOV2023 / 33"