Single-Family Downtrend Bottoming Across the Southeast
The aftermath of the pandemic produced a boom in single family home activity across the southeast region. With low interest rates and a continuous decline in single-family inventory throughout 2020 and 2021, the issuance of permits for new homes skyrocketed, despite ongoing price increases.
Both permit activity and home inventory are key indicators for assessing the HVAC industry. As permitting increases, we expect a subsequent rise in HVAC sales down the road. Similarly, we expect to see housing inventory expand as the housing market cools, and retract as it heats up.
As of Q2 2023, we’re seeing early signs that the downtrend experienced here in the southeast for the past 2 years may have bottomed out. In Alabama, Florida, Georgia, Kentucky, Mississippi, and Tennessee, the 3/12 trend is ramping back upward for permits and ramping down in home inventory.
It’s too early to tell if this will continue, especially with speculations of potential interest rate hikes due to job numbers. Plus, year-over-year numbers still show considerable decline, with the expectation that we will experience a 15% decrease in 2023 overall. 1However, these early signs support the idea that we may see turnaround and growth in the real estate market in 2024.
Marketing, Operations & Technology Manager
Shupe Carboni & Associates
1JP Morgan, HVAC Industry - Residential Market Model Refresh: The Unit Downturn Is Here, Masked By Price/Mix For Now p.21, 23, 36