Quarterly Trends Report

Industrials trends report Q2 2022: outlook for home builders as demand softens and supply constraints ease

  • Multi Asset
  • Industrials
  • North America

The past two years have been a rollercoaster for US homebuilding. The COVID-19 pandemic triggered a frenzied real estate market along with severe supply chain disruption, causing house prices to skyrocket. But easing lead times for key exterior materials paired with rising interest rates are now seemingly softening demand for residential homes.

While declining inventory levels were a feature of 2020/21, experts are now anticipating a steady return to pre-pandemic levels on the basis that supply chain constraints do not linger or deteriorate.5

Improving supply delays and waning demand have been consistent themes across many Forum Interviews in Q2 2022. One specialist, speaking about the windows market in Austin, Texas, said demand has fallen “5-10% below where it has been in years past”. Meanwhile, builders are now experiencing a two-week delay from a peak of 10-14 weeks. “That’s just been over the last month, month and a half that this has all transpired, like someone flipped the switch and said, ‘Let’s get back to where we were’,” the executive at an Austin-based windows and siding company told us.

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