Riding the Roller Coaster: Experts Offer Conservative but Optimistic Outlook

“Single-family [housing] could flatten out by the end of the year,” he said. “There are a lot of markets where prices may start getting away from what people can afford to pay particularly with the tighter restrictions on who’s eligible for a mortgage.”

Simonson noted, however, that there are some less positive factors playing a role in the recovery as well, including a continued slowdown in government spending.

The [2009] stimulus legislation was adding a lot to federal spending and those [projects] wound up in 2011 by and large, and the same summer the president and the leadership in congress agreed to very tight caps on discretionary spending,” he said.

While he said sequestration has “been a slope and not a cliff,” Simonson said it has also meant a cut in federal construction spending.

“With this slope federal discretionary spending is expected to continue to decline for many more years,” he said, and many local governments are having to follow suit.

Likewise, retail building is down, due to the growing trend of consumers purchasing items online that they would have purchased locally in the past.

“I do think the data center market will remain strong but data centers and warehouses don’t add up to anything like what we’ve seen in the retail market in the last decade,” he said.

Still, Simonson remains somewhat positive, though, for 2013. “By the end of the year I think we’ll see growth in the nonresidential and private spending and in residential spending,” he said.

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