Residential Construction—Ups and Downs

The construction segment has been hit hard and often by the COVID-19 pandemic. Starting with massive layoffs in March and April due to sites being closed for health safety reasons, the industry took advantage of the loosening of restrictions in May and June to add back workers.

According to the BLS report JOLTS (Job Openings and Labor Turnover Survey), the construction sector hired 679,000 workers in May, followed by 498,000 in June. By comparison, 423,000 construction workers were hired in June 2019. The construction hiring rate in May—the number of hires (679,000) divided by total employment and sector job openings—increased to 9.7%, after a subdued 3.7% rate in April. This was the strongest rate of hiring in the history of the JOLTS data. In June, the rate was 6.9%, slower than May, but still well above average.


COVID and New Construction: Lessons Learned

The novel coronavirus and its disastrous disease COVID-19 have run rampant across the world, causing deaths and economic as well as physical pain. Governments are working to find ways to lessen the damage and industries are doing the same. Construction, while often considered an essential business during the pandemic, has been hit hard with forced layoffs and office closings. In the midst of the crisis, lessons are being learned, both for future prevention and near-term mitigation of the effects of a pandemic. And designers, architects, and construction professionals are finding answers for their clients, too.

Taylor Morrison, a Scottsdale, Ariz.-based homebuilder and developer, has taken the idea of a “Healthy Home” to heart with its TM LiveWell, a standard offering for all new construction. Inspired by comments of home shoppers during the COVID-19 crisis, the builder is offering consumers healthy home features with in-home products for safer and cleaner living at no additional cost.


Remodeling and COVID-19

Many projects were slowed or postponed when the restrictions caused by the COVID-19 pandemic hit in March. Buildings were left partially completed, jobsites closed, and trades told to stay at home. But as the states begin to restore selected business operations on a limited basis, contractors hope to see delayed projects restarted.

Surveys done before the pandemic-caused restrictions seem quaint today but reputable organizations work to update their reports in light of the reality we are all living. For example, the NKBA (National Kitchen & Bath Assn.) modified its 2020 Kitchen and Bath Market Outlook to update it to account for dramatic changes in the industry resulting from the COVID-19 crisis. The report places the value of the residential K&B (kitchen and bath) industry at $130.8 billion.


Where Does ‘Smart’ Come From?

We use the term “smart” to describe many facets of modern homes. Often, it is a building that is computer controlled or monitored. Heat, air conditioning, appliances, perhaps security are all interconnected via the IoT (Internet of Things) network. Individual homes and complete neighborhoods can be remodeled or developed as smart.

For example, Alabama Power has developed a program called the Smart Neighborhood focused on homes that feature energy-efficient construction, energy-efficient appliances, connected devices, innovative security solutions, and home automation designed to simplify homeowners' lives and give them more control over their home and energy use.


Green Is Catching On

With the world’s attention on COVID-19 issues for the first part of 2020, many events have been slighted even though they may have long range implications. Prior to the coronavirus pandemic, the major long-range concern was the issue of climate change and its environmental impact. For decades, construction and architecture has had a focus on environmentally sustainable building: Going Green.

The Green Movement has been granted new energy with the publication of the 2020 Edition of the ICC-700 National Green Building Standard (NGBS) which was approved by the ANSI (American National Standards Institute) and is available for public use. Developed over the past three years, this latest installment expands the scope of applicable building occupancies, keeps abreast of new technologies, and advances the benchmark for residential projects designed and built for high performance.


Modularity in Housing

COVID-19 and the resulting economic crisis has impacted residential and commercial building even while states—with the exception of Michigan, New York, and New Jersey—have declared construction an essential business. In addition, construction projects in many parts of the U.S. were slowed as states adopted work rules—such as social distancing—that added to the time needed to complete jobs. The pandemic has also played a key role in causing construction-grade lumber to increase in price. A number of lumber producers have temporarily or permanently ceased operations, reducing lumber supplies as fewer homes were completed and renovation activity fell off.

Building materials suppliers and distributors did see solid sales growth in April due to seasonality and construction professionals stockpiling materials for future use, but primarily sales were supported by homeowners engaging in DIY (do-it-yourself) projects, such as building decks and fences, renovating rooms, and installing shelving.


Affordable Housing

The COVID-19 pandemic has caused economic hardship across all sectors. Job losses in March, for example, contributed to a decline in U.S. median income and housing affordability according to the NAHB (National Assn. of Home Builders)/Wells Fargo HOI (Housing Opportunity Index).

The Index shows only 61.3% of new and existing homes sold between the beginning of January and end of March were affordable to families earning an adjusted U.S. median income of $72,900. This income level is down from $75,500 in the fourth quarter of 2019 when 63.2% of homes sold were considered affordable.


IoT in the Home: Grow or No?

For homebuilders, home technologies have been a competitive advantage to helping sell new homes. Now, the incorporation of smart-home technology is becoming more important than ever before, according to some recently released research.

A new report points to the importance of incorporating smart-home technology into new home projects. LexisNexis Risk Solutions released an insurance claims study revealing that in-line water shutoff systems correlate with a decrease in water claims events by 96%.