Editor's Product Pick
–Stephani L. Miller
Housing Market Rebound?
Not So Fast
The week we put the May issue to bed–the issue in which we included dealer predictions that the second half of 2007 will see a marked improvement in the housing market–bleak news came streaming in from manufacturers and news outlets. In reporting its first quarter net loss of $37 million on April 25, for example, LP Building Products CEO Rick Frost said, "I do not see this market improving substantially for the rest of 2007."
During NAHB's Spring Construction Forecast Conference later that week, economists expressed optimism that the industry could start turning around by the second half of the year, reports NAHB's Nation's Building News (NBN), but the news still was not pretty. According to NBN, NAHB chief economist David Seiders had expected the housing correction to be diminishing by this time, but said that subprime woes were affecting demand and that housing activity and builder sentiment had declined in March and April. NBN also quoted Seiders as saying that while he predicts a turnaround later this year, it will be a couple more years until starts reach the long-term sustainable level of 1.95 million.
On May 16, NAHB announced that housing starts increased 2.5% in April to a seasonally adjusted rate of 1.528 million units, down 16.1% from a year earlier. Building permits dropped 8.9% in April to a seasonally adjusted rate of 1.429 million units, 28.1% less than a year earlier. "The pattern of building permits clearly shows that the dramatic downward correction in housing production still is under way," Seiders said in the announcement. "Home buyer demand has been sent into another down leg by the abrupt tightening of mortgage lending standards, and there is increasingly heavy supply of vacant housing units on the market. Under these conditions, builders are cutting back on new construction and intensifying their efforts to bolster sales and limit cancellations."
Eighty Four, Pa.?based 84 Lumber announced the purchase of two Denver-area companies: JAC & Co., an installation services provider, and Front Range Panel, a wall panel manufacturer. ...Spenard Builders Supply, a division of Englewood, Colo.?based Pro-Build Holdings, has acquired Polar Supply Co., a provider of commercial-grade structural, geotechnical, environmental, and corrosion-prevention products with three facilities in Alaska. ...Pro-Build's US Components division has purchased Casmin, a roof and floor truss manufacturer based in Leesburg, Fla. Casmin has two truss plants. ...Lezzer Lumber, Curwensville, Pa., has acquired J.H. Brubaker Co., a 35-year-old pro supplier with three Pennsylvania locations. ...Fullerton Lumber, Plymouth, Minn., has acquired Osceola Lumber Co., a pro yard in Osceola, Wis.
ABC Supply Co., headquartered in Beloit, Wis., announced the following location openings in April: Belcamp, Md.; Bloomington, Ind.; Jackson, Mich.; Lansing, Mich.; and Watertown, N.Y. ...Dixieline Lumber and Home Centers, another division of Pro-Build, opened a 23,000-square-foot store in Murrieta, Calif., the San Diego?based dealer's first Inland Empire?area location. ...84 Lumber celebrated the grand opening of its new San Antonio component manufacturing plant on April 24. The 14.5-acre property, the dealer's 22nd manufacturing facility, includes a 5,040-square-foot main building and a 47,574-square-foot manufacturing building. ...Fullerton Lumber opened a new 24,000-square-foot facility on 9 acres in Ellsworth, Wis., replacing a location a mile away.
McCoy's Building Supply, San Marcos, Texas, promoted John Meeks to senior vice president, corporate development; Rick Neal to senior vice president and CFO; and Dennis Strong to senior vice president and chiefinformation officer. ...ABC Supply Co. promoted 24-year company veteran Brent Fox to vice president of merchandising and purchasing, and promoted Tim Hashagen, with the company 10 years, to South Florida district manager. ...The National Lumber and Building Material Dealers Association named Diana Perenza, vice president of Florence Corp. in Huntington, N.Y., as its 2006 Grassroots Dealer of the Year.
Harry T. Williams Lumber Co., a 98-year-old LBM supplier based in Los Angeles, announced April 5 it has changed its name to Blue Ox Lumber Co. The company also welcomed Lonnie Schield as chairman of the board and Bob Erskin as vice president of sales, and it promoted Jason Fraler from general manager to COO. ...Pulte Homes has halted, at least temporarily, production of SIPs and other engineered building systems at its plant in Manassas, Va., citing lack of housing demand. The decision came a few weeks after the facility was mentioned in ProSales' April article "Consider the Alternatives" (page 78).
According to the National Opinion Research Center, salespeople at hardware and building supply stores rank 11th among all occupations in general happiness. In overall job satisfaction, freight, stock, and material handlers ranked sixth from the bottom. The least satisfied? Roofers.