Home Building
Home Building: An Economic Driver
A quiet revolution is taking place in the home building industry. Forced by the economy for better quality products, greater efficiency, and more productivity, home building industries are revisiting their short and long-term goals. New techniques, products and materials, and new relationships with trade partners all play an important part in home building today. While many of the changes may seem negligible, when added together, the impact is significant. Momentum is growing and changing the face of the home building industry. This paper will provide a history and overview of the home building industry, evaluate six economic indicators, provide an in-depth analysis of 18-month forecasts, provide recommendations, and outline specific strategic initiatives for continued profitability in the home building industry.
The history of the home building industry in America begins with the Native Americans who built such structures as longhouses, pueblos, and teepees. As the country colonized, developers built brick row houses and many employers in industrial towns erected dormitories and apartment buildings for workers. Home building was largely controlled by corporations which rented the homes to employees. As a result, corporations owned the towns and therefore shaped the economy (Hayden, 2006). Through the years, home building has been on a roller coaster. More recently, big home building booms seem to have occurred in the 1920s, 1950s, 1990s, and 2000s. In the 1970s, the home building industry suffered several setbacks: rising unemployment, stagnant income growth, rising inflation, and declining productivity. The United States was embroiled in the worst recession since the Great Depression and home building came to a halt due to increases and decreases in interest rates and the resulting effect on monthly mortgage payments (EconEdLink, n.d.).
The Federal Reserve Board (FRB) was responsible for the...
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