The construction industry has been at a near standstill for several years now. I was a real estate agent in the beginning of the crash, but as business dropped off more each year, I gave it up and went back to writing. Every year the predictions were for construction and real estate to pick up the following year, but that has not materialized yet! What’s in store?
I think I made a good move, since the McGraw Hill Construction forecast says building will remain depressed in 2012. The main reasons are the same as they have been: a down economy, reduced funding, slow employment growth and uncertainty about the future, including employment and the value of a building.
Construction increases and decreases for 2012
The predictions for increases are:
- single family housing 7%
- multi-family buildings 17%
- commercial building 8%
- manufacturing buildings 4%
The predictions for decreases are:
- institutional buildings 2%
- schools and healthcare facilities 1%
- public works 5%
- electric utilities 24%
Some of these sectors had already seen dramatic change, either positive or negative, in 2011, so the industry is far from stable. It could change, and not for the best, if we enter a double-dip recession.
Builder confidence on the rise
That said, the National Association of Home Builders (NAHB) says builder confidence has been slowly on the rise the last few months of 2011. The big hold-up is financing. It’s difficult to get a mortgage, government funding has dried up, and bad appraisals are killing sales. Nevertheless, NAHB is expecting an upturn in 2012.
As far as green building, the key word will be functional with a more practical use of space.
- Homes will be smaller, more affordable and energy efficient.
- Kitchens and bathrooms will be smaller and more practical.
- Living rooms may be combined with the kitchen and entryway as a great room, or they may disappear altogether in favor of a family room.
- Formal dining rooms, hobby rooms and mudrooms may be done away with.
- Low-e windows, efficient lighting, water saving fixtures, engineered beams and a whole-house Energy Star rating will become commonplace.
Building trends for 2012 and Jerry Yudelson
Jerry Yudelson, green building and sustainability author, speaker and builder, has a rosy forecast for the industry in 2012. He expects green building to rebound in the states.
Energy efficient retrofits will be more common than new construction. Global green building will increase as countries create their own green building councils to advance energy efficiency and reduce CO2 emissions. Water conservation will be an important feature this year. Rainwater catchment, water conserving fixtures, and new technologies will be in designs to ward off water scarcity.
Green building to become the standard
Net zero energy homes will become more common, and homes will be maintained and monitored with high tech wireless controls. Performance disclosures to tenants and buyers will be on the rise. Building performance is where energy efficiency is most evident. Solar will grow, and governments will be mandating more efficient building. President Obama’s Better Building Initiative requires $2 billion for energy retrofits of federal buildings.
Other trends include nature in indoor and outdoor landscapes. Rocks, water features and native plants will mimic native surroundings. Green roofs will be employed to absorb storm water run-off and prevent flooding.
Minimalism and simplicity will be key, as this economy has driven us all to let go of the superfluous and embrace the functional and practical. Despite that, the western world is way more extravagant than other areas. This is a start, though!