During the past decade, construction activity in Cincinnati has been on a roller coaster ride. Since 2006, when the housing market reached its peak before going into a deep slump that brought down an entire industry and put thousands out of work, there have been several upturns, with each one seeming to be bigger than the last. And after all this time, it looks like we are finally getting back to normal. According to statistics from the U.S Department of Commerce, in 2015, total construction started to increase by about 20 percent from 2014, while new privately-owned housing was up by 5 percent over 2014 numbers. The good news doesn’t stop there; 2016 is expected to see even more growth for both categories, which will increase opportunities for those working in the construction industry.
Construction has been a critical part of Cincinnati’s economy since its infancy, and that means it will have an important role for years to come. In 2014 alone, new privately-owned housing units totaled more than 1,000, with total construction starts numbering over 10,000, a 4 percent increase from 2013. The fact that 2015 showed even more significant increases is a perfect sign of things to come. According to James A. Graaskamp, who wrote an article published on October 3rd by the National Association of Home Builders, “After a seven-year economic expansion since the Great Recession ended in 2009, we expect sales of new homes to grow this year and next as homebuyer demand continues at solid levels.” The article goes on to say that “In September, new home sales totaled a seasonally adjusted annual rate of 504,000 units, up from August’s 457,000 units. This brought the number of new homes sold in the first nine months of 2015 to 1.1 million units at a seasonally adjusted annual rate, up 18 percent from this time last year.”
James A. Graaskamp is an economist with Schaeffer’s Investment Research. His findings are supported by those who work in the trenches and make policy decisions concerning housing construction across the country. In Cincinnati alone, over ten large projects were completed in 2014, which included several upscale housing developments like The Banks On Elm Street (condominiums) and 400 East Rich Street (apartments).
The increase in new construction has many effects on the larger economy, including the rise of employment opportunities, increased tax revenues at all levels of government, and a rise in disposable income as more people move into their newly constructed homes. In a city like Cincinnati, this can bring much-needed money back to our local economy. This increase in home construction also affects other sectors, such as furniture stores that provide living room sets or bedroom sets. It also increases demand for numerous services from landscapers to plumbers and heating/cooling companies, resulting in increased tax revenue from these services. One of the main drivers in the increase of home construction is the upswing in residential development. With home prices at an all-time low and demand for housing still increasing across the country, especially here in Cincinnati, many developers see an opportunity to build relatively cheap homes that will sell even if they break even or lose a little money.
This influx of new houses increases supply, driving housing prices down further since more places are available than people looking for them. This continues to go housing prices lower until finally enough new homes have been built so that supply and demand come back into balance again. This whole cycle can take anywhere from 4 to 12 years, depending on how long it takes for supply and need to return to equilibrium with one another after being out of balance.
Cincinnati Concrete is one of the leading providers in the construction industry in Cincinnati, OH. They offer many different types of concrete, including stamped concrete, exposed aggregate, decorative concrete, and fiber reinforced concrete. Cincinnati Concrete Companies’ contribution to the construction industry is to provide quality materials that are safe and durable.