Following up on the previous generalized post about business cycle, in this post I want to address homebuilders and the construction industry, specifically. The analysis must start with this chart from a recent post. This is the real per capita consumption of housing over time. Real housing consumption, per capita, increased in a dependably linear pattern until 2010, and then it went flat. (Actually, 2008 is probably the more appropriate breaking point, as 2010 was well below the 1960-2008 trend. And, isn’t it wild that the conventional story of the 2000s is that we overstimulated and overbuilt housing? Real per capita housing consumption, even in 2005, was below any trendline you could have drawn leading up to that decade! The only way to have such a bloated housing market, as we have again today, is to not have enough of it!)
The Base Case is Optimistic: Homebuilders
The Base Case is Optimistic: Homebuilders
The Base Case is Optimistic: Homebuilders
Following up on the previous generalized post about business cycle, in this post I want to address homebuilders and the construction industry, specifically. The analysis must start with this chart from a recent post. This is the real per capita consumption of housing over time. Real housing consumption, per capita, increased in a dependably linear pattern until 2010, and then it went flat. (Actually, 2008 is probably the more appropriate breaking point, as 2010 was well below the 1960-2008 trend. And, isn’t it wild that the conventional story of the 2000s is that we overstimulated and overbuilt housing? Real per capita housing consumption, even in 2005, was below any trendline you could have drawn leading up to that decade! The only way to have such a bloated housing market, as we have again today, is to not have enough of it!)