Competitive Analytics | New Housing Unit Supply - Competitive Analytics

New Housing Unit Supply

June 16, 2009

Executives need to keep an occasional eye on “Euro Zone Employment” which drives significant US demand for goods and services and vice versa. The 16 Euro Zone Countries lost a record 1.2 million jobs during 1Q2009 and lost 3.1 million jobs since April 2008.

Tracking and analyzing Euro Zone employment versus US employment is judicious given the two regions commensurate size and intertwined economic relationships. Example: US employment during May 2009 stands at 140.6 million with 14.5 million unemployed (9.4%) versus Euro Zone at 146.2 million employed with 14.6 million unemployed (9.2%). Stay tuned! 16 Euro Zone Members: Austria, Belgium, Cyprus, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain. Welcome to our 2nd week of 60SMI. Our inaugural week generated 867 views and extremely positive comments. So thank you for clicking and reading! 

Key Indicator of the Week (data released 06/16/09 5:30AM PST) – New Housing Unit Supply for May 2009 generated significant year-over-year decreases in four sub-categories:  1) NHU Permits slumped to 48,100 which is 100,973 units below cycle equilibrium; 2) NHU Starts tumbled to 51,200 units which is 98,409 below cycle equilibrium; 3) NHU Under Construction plummeted to 658,700 which is 421,109 units below cycle equilibrium; and 4) NHU Completionsplunged to 67,600 which is 62,918 units below cycle equilibrium.  These numbers were not unexpected. We recommend monitoring these four NHU supply indicators along with their respective “Cycle Equilibriums.” For advanced analysis, the TPSI engine forecasts all new housing supply indicators by geographic sub-market via market momentum shifts and forecasts of a myriad of macro and micro economic, demographic, capital market, and government indicators affecting new housing supply.

New Housing Unit Supply – United States – Year-Over-Year Synopsis

Why Track this Indicator?New Housing Unit Supply enables you to forecast potential timing and delivery of new homes coming to market. “Permits” offer a proxy of potential deliveries over the next 9 to 18 months. “Starts” measure the number of dwellings commencing the construction process. “Under Construction” offers an estimate of deliveries over the next 3 to 12 months. “Completed Homes” offer just that, homes ready for sale and occupancy. It’s important to analyze supply indicators on “year-over-year” and “rolling average” methods due to the material seasonality effect. These indicators of NHU Supply represent only 4 of the 36 new supply sub-indicators we track when conducting detailed analytics of New Home Supply by geographic submarket – all of which are critical inputs for running precision econometric demand models and forecasts.  Competitive Analytics regularly forecasts New and Existing Home Supply, Defaults, Foreclosures, REOs, and Apartment Supply for all product types and geographic submarkets within North America and the UK.  If you require a comprehensive assessment and forecast of housing supply and/or interested in a customized analysis of the over 2,800 indicators we track, filter, cleanse, analyze and forecast within our TPSI database, please call.

TPSI  (1000 Point Strength Index) is the most comprehensive and precise market measurement tool of its kind.  500.0 is benchmarked as the mathematical stabilized equilibrium; historical figures and forecasts above or below 500.0 reflect relative strength or weakness, respectively.  The TPSI has the ability to track and forecast over 2,800 market indicators and capable of in-depth analysis, forecasting, and dynamic what-if analysis of macro economies, industries, organizations, product types, services, and competitive geographic market areas. Click here for an example.

An Extra 60 Seconds: Careful recommendations for the busy executive.

Article Link of the Week: Stay the Course: The Debate Over Economic Policy – By Paul Krugman.

Business Book Link of the Week: Eager Sellers and Stony Buyers: Understanding the Psychology of New-Product Adoption – By John T. Gourville.

SEQOL Link of the Week: Predictions: The Next 200 Years – By Michael Ventura.

Quote of the Week: ”I think everybody should get rich and famous and do everything they ever dreamed of so they can see that it’s not the answer.” – Jim Carrey.

About SEQOL (Significantly Enhancing Quality of Life). We passionately feel that “responsible business practices” are about balancing both profitability AND quality of life. If you are interested in understanding more about this innovative model, receiving a 9PQ Audit (Nine Perpetual Questions that Drive Responsible Businesses) and/or receiving our upcoming SEQOL Weekly Newsletter, please contact us.

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