Housing will contribute to growth for the first time in seven years as apartment construction leads the U.S. building industry, experts' projections indicate.
Economists Michelle Meyer and Celia Chen of Bank of America and Moody's Analytics, respectively, independently arrived at this conclusion. Their expectations do differ significantly, with Meyer predicting a 45 percent increase in construction, as builders begin work on 260,000 townhouse developments and apartment buildings, which would be the most since 2008.
Chen's projections are even more generous for the industry, including a record 74 percent increase in construction to reach 310,000 starts on multifamily properties. Commerce Department data records 6.8 and 54 percent increases in multifamily construction during 2010 and 2011, after four consecutive years of falling numbers ended in a record low of 108,900 starts.
Expert Patrick Newport told Bloomberg that the nation will likely see an increase in household formation, with an emphasis on renter households rather than homeownership. This could increase the importance of effective tenant credit screening and other procedures as landlords and rental property management companies deal with larger numbers of applicants.