Improving Housing Market Bodes Well for Coatings, Adhesive and Sealants Market

November 8, 2013

According to a recent report from the National Association of Realtors, new-home sales are at a five-year high.  Despite rising mortgage rates, single-family new-home sales rose 8.3 percent in June to the highest level since May 2008, the Commerce Department reported. Single-family new-home sales were up 38.1 percent compared to June of last year — the largest year-over-year increase since January 1992.

According to data from the National Association of Realtors, total existing-home sales this year will be 10 percent higher than 2012, reaching more than 5.1 million, and are likely to hold even in 2014. The national median existing-home price is expected to rise 11 to 11.5 percent for all of 2013, but moderate to a 5 to 6 percent gain in 2014.

These positive gains are being felt by manufactures of paint, coatings, adhesives and sealant. In the two feature articles in this issue, manufacturers attributed improvements in their business with improvements in the housing market.

In the “Exterior Architectural Coatings Market” (page 32), coatings manufacturers I interviewed reported growth that was being fueled by an improved housing market and an increase in consumer confidence.  “The rebound in construction activity is a key driving force in this improvement,” said Ethan Opolion, product manager at Dunn-Edwards.

This positive sentiment was also reflected in associate editor, Bridget Kelbaur’s article, “Adhesives and Sealants Market” (page 37). According to her article, home sales are the highest levels they have been in four years and homebuilders continue to hire additional workers in anticipation of a continued robust housing market.

Despite these positive reports, there is no doubt that consumer confidence took a hit with the recent 16-day government shutdown. Economists worry that the conflict in Washington could damage  the U.S. economy. Let’s hope this proves to be a temporary setback and the positive trend continues into 2014.

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