Deutsche Bank (DB) analysts just sent a note to investment clients that gives a fairly bullish view of housing going into 2013.
"In our 2013 real GDP forecast, we anticipate residential investment growth of 10% which would be roughly in line with housing starts of approximately 900k next year (compared to 750k at present)," the Deutsche Bank anlaysts write. "This assumes a +0.3 percentage point contribution from housing in 2013. Starts will still be well below the average of 1.5 million from 1959 to present, so the risk may be to the upside."
Housing’s contribution to the labor market could be meaningful as well, they say.
Since bottoming at approximately 560,000 in May 2011, residential construction payrolls essentially remained flat as of the August payroll report, 564,000.
"This is only modestly above the historical low of 543k in May 1992," they say. "Even a return to the peak of the 1991 – 2001 expansion implies jobs gains of over 170k in residential construction alone."