Tuesday, October 19, 2010

Illinois Tool Works CEO predicts weak 2011 for housing industry

The Illinois Tool Works CEO, whose company makes equipment for housing construction, predicts no housing industry improvement until 2012:
The U.S. housing industry will continue to struggle through 2011 and likely won’t improve significantly until 2012, Illinois Tool Works Inc. Chairman and Chief Executive David Speer predicts.

High rates of mortgage of foreclosures and falling housing prices will continue to provide headwinds for sales of new and existing homes, Mr. Speer says. Moreover, persistently high levels of unemployment will dampen consumers’ interest in residential real estate.

“The consumer is still facing tremendous challenges, certainly in the housing market,” Mr. Speer says.

Mr. Speer’s Glenview, Ill., company operates more than 800 separate manufacturing businesses covering a variety of industrial sectors, including construction, automotive, packaging and food service. About 20% of ITW’s $13.9 billion in sales last year came from products used in real estate construction and remodeling work.


  1. What a prediction! I see that this man also reads the same charts that are readily available across the Intertubes... http://optionarmageddon.ml-implode.com/wp-content/uploads/2009/02/1-mortgage-rate-resets1.png

    Early to mid 2012 is when buying begins again. That's when carbon-related taxes will kick in, which will likely kill the next housing boom.

    Newer homes will need to be audited (check your local community colleges for new classes for obtaining the audit credentials, so you can terrorize your community and play stasi brown shirt) for carbon emissions, and then fitted with emissions-reducing materials that will cost an arm and a leg. No one will be able to afford to buy or sell when that happens.

  2. Anon: Link please re: 2012 carbon taxes...

  3. International Code Council will Define Future of Green, Housing Industry
    June 2nd, 2010 http://www.greenbuilttexas.com/greenvinecolumn/international-code-council-will-define-future-of-green-housing-industry/

    New Guidelines for ENERGY STAR Qualified New Homes
    New Version 3 Guidelines (formally known as ENERGY STAR 2011)

    "The UK is currently the only country with a carbon auditing system, but there's a good chance that other countries will create their own in short order. Carbon auditors will be needed to make sure that the output from businesses and other major producers are within appropriate limits. This is a new, expanding field that's going to need a lot of people to ensure that we get closer to becoming carbon neutral."

    Last I checked, the scientific community still had not formed a consensus around whether global warming is a problem, if CO2 is causing it, or if mankind creates enough C02 to affect temperatures. So why is this moving forward as if it is gospel truth?

  4. Specific to residential...


    "At first, the IGCC was only aimed at commercial construction, but it has since come to incorporate, by reference, the NAHB’s ICC-700 program (also known as The National Green Building Standard).

    “The reference to the National Green Building Standard (NGBS) essentially means that any community that adopts the new green construction code for commercial building would also be adopting the NGBS for home construction."