AHMA Confidence Index Retreats in April
Manufacturers also express a preference for Marco Rubio as republican VP candidate and a belief that the NLRB is pushing a pro-union agenda.
The American Hardware Manufacturers Association’s AHMA Home Improvement Industry Confidence Index’s Current Situation Index declined in April to 308.3 from an all-time high of 350.0 in March (April 2008 = 100), while the Future Expectations Index also fell to 239.7 from 298.3.
In comparing current sales levels to year-ago levels, 74 percent of respondents said sales were higher in April versus year-ago levels, down from 84 percent in March. For April, four percent reported sales were even, and 22 percent said sales were below year-ago levels.
Looking forward six months, 62 percent of April respondents said they expect sales to be above current levels, down from 84 percent in March. In April, 35 percent of respondents said they expect sales to be even in six months and four percent expect sales to be below current levels.
Looking forward one year, 77 percent of respondents project sales will be higher, down from 89 percent who felt that way in March. Fifteen percent of April respondents project sales will be even one year from now and eight percent project sales will be below current levels.
Other Monthly Economic Reports Send Mixed Signals
Retail sales of home improvement products (NAICS 444) increased 3.0 percent in March to $27.758 billion from $26.941 billion in February. Sales were up 14.1 percent from March 2011 levels.
Advance estimates of all U.S. retail and food services sales for March, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $411.1 billion, an increase of 0.8 percent (±0.5%) from the previous month and 6.5 percent (±0.7%) above March 2011. Total sales for the January through March 2012 period were up 6.4 percent (±0.5%) from the same period a year ago. The January to February 2012 percent change was revised from 1.1 percent (±0.5) to 1.0 percent (±0.2%).
Existing-home sales were down in March but continue to outpace year-ago levels, while inventory tightened and home prices are showing further signs of stabilizing, according to the National Association of Realtors.
Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, declined 2.6 percent to a seasonally adjusted annual rate of 4.48 million in March from an upwardly revised 4.60 million in February, but are 5.2 percent above the 4.26 million-unit pace in March 2011.
Lawrence Yun, NAR chief economist, said the recovery is in the process of settling into a higher level of home sales. “The recovery is happening though not at a breakout pace, but we have seen nine consecutive months of year-over-year sales increases,” he said. “Existing-home sales are moving up and down in a fairly narrow range that is well above the level of activity during the first half of last year. With job growth, low interest rates, bargain home prices and an improving economy, the pent-up demand is coming to market and we expect housing to be notably better this year.”
Total housing inventory at the end of March declined 1.3 percent to 2.37 million existing homes available for sale, which represents a 6.3-month supply at the current sales pace, the same as in February. Listed inventory is 21.8 percent below a year ago and well below the record of 4.04 million in July 2007.
Sales of new single-family houses in March 2012 were at a seasonally adjusted annual rate of 328,000, according to estimates released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 7.1 percent below the upwardly revised February rate of 353,000, but is 7.5 percent above the March 2011 estimate of 305,000.
The median sales price of new houses sold in March 2012 was $234,500; the average sales price was $291,200. The seasonally adjusted estimate of new houses for sale at the end of March was 144,000. This represents a supply of 5.3 months at the current sales rate.
Privately-owned housing starts in March were at a seasonally adjusted annual rate of 654,000. This is 5.8 percent below the revised February estimate of 694,000, but is 10.3 percent above the March 2011 rate of 593,000.
Single-family housing starts in March were at a rate of 462,000; this is 0.2 percent below the revised February figure of 463,000. The March rate for units in buildings with five units or more was 178,000.
Privately-owned housing units authorized by building permits March were at a seasonally adjusted annual rate of 747,000. This is 4.5 percent above the revised February rate of 715,000 and is 30.1 percent above the March 2011 estimate of 574,000.
Single-family authorizations in March were at a rate of 462,000; this is 3.5 percent below the revised February figure of 479,000. Authorizations of units in buildings with five units or more were at a rate of 262,000 in March.
The Conference Board Consumer Confidence Index, which had declined slightly in March, was virtually unchanged in April. The Index now stands at 69.2 (1985=100), down slightly from 69.5 in March. The Expectations Index declined to 81.1 from 82.5, while the Present Situation Index improved to 51.4 from 49.9 last month.
Says Lynn Franco, Director of The Conference Board Consumer Research Center: “Consumer Confidence was virtually unchanged in April, following a modest decline in March. As was the case last month, the slight dip was prompted by a moderation in consumers’ short-term outlook, while their assessment of current conditions continued to improve. Overall, consumers are more upbeat about the state of the economy, but they remain cautiously optimistic.”
“Hot Topic” Questions:
The April Confidence Index survey asked two supplemental questions of AHMA members:
“Assuming Mitt Romney becomes the republican candidate for president, which of the following would you most like to see selected as his VP / running mate?” and “Do you think the National Labor Relations Board under the Obama administration has been pushing a pro-union agenda?”
To the first question, on the VP candidate, 52 percent responded “ Marco Rubio,” 40 percent responded “Chris Christie,” and eight percent responded “Paul Ryan.”
On the pro-union agenda of the NLRB, 85 percent responded “Yes,” eight percent responded “Not Sure,” and eight percent responded “No.”
Next month in this space, the May 2012 AHMA Home Improvement Industry Confidence Index will provide you with another timely indication of how your peers perceive the industry’s current situation and future prospects for growth. Please look for our online survey in your e-mail Tuesday, May 29 to participate and share with us your valuable insights. And thanks to all who have been responding to the online survey!