western region conference - the recovery: how long, how fast
DESCRIPTION
HARDI Economist Andrew Duguay discusses trends in the Western Region Forecasting Seminar at the 2011 HARDI Western Region Conference.TRANSCRIPT
itreconomics.com
March 2011Presented By:
ITR
Andrew Duguay
itreconomics.com
US Industrial Production to Gross Domestic Product3/12 Rates-of-Change
-15
-10
-5
0
5
10
15
'82 '84 '86 '88 '90 '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 '14-15
-10
-5
0
5
10
15
GDP
US IP
ITR Trends Report
itreconomics.com
3
Employment – Private Sector Annual Data Trend
85
90
95
100
105
110
115
120
'92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 '1485
90
95
100
105
110
115
120
Employment Mils of Jobs
ITR Trends Report
itreconomics.com
HARDI Member Sales to US EconomyYear over Year % Change
-15.0
-10.0
-5.0
0.0
5.0
10.0
15.0
Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11
Yea
r o
ver
Yea
r %
Ch
ang
e
HARDI Member Sales
US Economy
HARDI T.R.E.N.D.S. Reports
itreconomics.com
5
HARDI West Region Sales GrowthYear-Over-Year % Growth
-20
-15
-10
-5
0
5
10
15
20
25
2006 2007 2008 2009 2010 2011 2012
-20
-15
-10
-5
0
5
10
15
20
25
West
All HARDI
10.9%
5.4%
HARDI T.R.E.N.D.S. Reports
itreconomics.com
Foreclosure Rates by State
RealtyTrac.com
itreconomics.com
Alaska and Hawaii
Alaska 7.5% - 3.2% 61.5%Hawaii 42.8% - 3.8% - 55.4%
CommercialConstruction
Housing HomePermits Prices
HARDI T.R.E.N.D.S. Reports
Anchorage Housing Permitsthousands of units
1.737
1.063
0.478 0.547 0.534
2006 2007 2008 2009 2010
Honolulu Housing Permitsthousands of units
2.606 2.700
1.752
0.991
1.876
2006 2007 2008 2009 2010
itreconomics.com
Washington and Oregon
Oregon 6.0% - 6.6% 62.6%Washington 17.5% - 6.6% - 38.4%
CommercialConstruction
Housing HomePermits Prices
HARDI T.R.E.N.D.S. Reports
Seattle, Tacoma & Bellevue Housing Permitsthousands of units
25.896 26.236
15.136
6.6479.273
2006 2007 2008 2009 2010
Portland Housing Permitsthousands of units
15.325
12.888
7.745
3.601 4.205
2006 2007 2008 2009 2010
itreconomics.com
Montana, Idaho and Utah
Idaho - 13.9% - 10.6% - 71.8%Montana 16.9% - 4.7% - 9.8%Utah - 11.1% - 4.6% 40.0%
CommercialConstruction
Housing HomePermits Prices
HARDI T.R.E.N.D.S. Reports
Boise Housing Permitsthousands of units
8.409
5.172
2.7462.018 1.723
2006 2007 2008 2009 2010
Salt Lake City Housing Permitsthousands of units
11.240 11.367
8.2057.206
6.168
2006 2007 2008 2009 2010
itreconomics.com
Nevada and Arizona
Arizona - 18.3% - 10.5% 19.4%Nevada - 8.5% - 8.3% - 66.6%
CommercialConstruction
Housing HomePermits Prices
HARDI T.R.E.N.D.S. Reports
Las Vegas Housing Permitsthousands of units
30.643
23.879
12.55
5.682 5.469
2006 2007 2008 2009 2010
Phoenix Housing Permitsthousands of units
42.591
35.583
17.414
9.471 8.276
2006 2007 2008 2009 2010
itreconomics.com
California
California 24.6% - 2.8% - 34.8%
CommercialConstruction
Housing HomePermits Prices
HARDI T.R.E.N.D.S. Reports
Los Angeles Area Housing Permitsthousands of units
33.239
25.942
15.290
7.167
10.526
2006 2007 2008 2009 2010
SanFransisco - Oakland Area Housing Permitsthousands of units
13.391
9.883
6.891
3.5674.679
2006 2007 2008 2009 2010
itreconomics.com
12
West Housing PermitsRates-of-Change
-60
-45
-30
-15
0
15
30
45
'05 '06 '07 '08 '09 '10 '11 '12 '13
-60
-45
-30
-15
0
15
30
45
3/1212/12Forecast
8.07.9
Forecast
2011 -4.0%
2012 12.0%
HARDI T.R.E.N.D.S. Reports
itreconomics.com
Accuracy of ITR’s Forecast
Actual/Estimate % Deviation
Mar-10 forecast 103.3 - 108.1 -28.4% to -25.1%actual 0.0%
Jun-10 forecast 106.8 - 110.7 -8.4% to -5.1%actual 0.0%
Sep-10 forecast 107.5 - 110.5 3.4% to 6.3%actual -0.3%
Dec-10 forecast 109.1 - 111.9 9.9% to 12.7%actual 0.0%
-26.2%
-7.2%
3.1%
11.0%
106.5
108.2
107.2
110.3
Annual Permits Growth Rate Forecast Period
West Region Housing Starts Forecast
Thousands of Units
HARDI T.R.E.N.D.S. Reports
2009 Permits: 99.3 thousand
itreconomics.com
Accuracy of ITR’s Forecast
Actual/Estimate % Deviation
Mar-10 forecast 7.154 - 7.530 -48.6% to -45.9%actual 3.9%
Jun-10 forecast 6.343 - 6.809 -46.9% to -43.0%actual 0.0%
Sep-10 forecast 6.565 - 6.850 -31.0% to -28.0%actual 0.9%
Dec-10 forecast 6.683 - 6.908 -16.8% to -14.0%actual -4.6%
Forecast Period
West Region New Commercial Construction Forecast
Billions of Dollars
Annual Value Growth Rate
7.825
6.640
6.503
6.373
-44.4%
-45.7%
-35.6%
-27.2%
HARDI T.R.E.N.D.S. Reports
2009 Construction: $8.8 billion
itreconomics.com
15
West Commercial ConstructionRates-of-Change
-90
-60
-30
0
30
60
90
120
'05 '06 '07 '08 '09 '10 '11 '12 '13
-90
-60
-30
0
30
60
90
120
3/1212/12Forecast
5.5
-23.1
Forecast
2011 -1.4%
2012 11.6%
HARDI T.R.E.N.D.S. Reports
itreconomics.com
West Region in Summary
HARDI T.R.E.N.D.S. Reports
Slower 2011
Better 2012 and 2013
Housing market will not be a quick fix
Fundamentals remain positive
itreconomics.com
itreconomics.com
Consumer Price Index to Crude Oil Futures Prices12/12 Rates-of-Change
-1
1
3
5
7
9
'92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12
CPI
-90
-50
-10
30
70
110OIL
CPI
OIL
ITR Trends Report
End of 2010
Copper 46.0%
Aluminum 30.0%
Iron Ore 63.0%
Gold/Silver 26 & 37%
Forestry 24.0%
Agriculture 38.0%
Cotton 83.0%28.7%
itreconomics.com
-80
-60
-40
-20
0
20
40
'92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 '14
R-O-C
400
600
800
1000
1200
1400
1600
MMT
17.717.4
$743.5
Oct '09
Nov '09
Jul '08
Dec '05
Nondefense Capital Goods New Orders w/o Aircraft Billions of $
12MMT
3MMT
3/12 12/12
ITR Trends Report