Industry NewsMarkets & Economy

Economists disagree on meaning of ‘recovery’

Analysts see pent-up demand in low household formation rates

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Editor's note: This article is republished with permission of Builder magazine. View the original article: "NAHB's Spring Forecast Analyzes an Elusive Recovery." By CLAIRE EASLEY While each of the three presenters at the National Association of Home Builders' spring 2011 Construction Forecast agreed that things will be better by the end of next year, there was some dissension on the extent to which improvement can be expected, underscoring how elusive an accurate projection of the recovery continues to be. David Crowe, chief economist at the NAHB, defined a normal housing market as one in which 1.5 million new homes are being produced each year. He calculates that we are currently at less than a third of such a rate, but is expecting modest increases to show up in this year's second-quarter reports. From there, Crowe anticipates that the recovery will stay on a steady upward track until reaching the 1.5 million mark by the end of 2012. Mark Zandi, chief economist at Moody...