Economists say a rebound from the chaos of 2020 is still going to take some time, though progress is being made.
The last few months of 2020 saw a rebound, but slowed as the year came to an end with the fourth quarter stuttering a bit.
Analysts say the first few months of 2021 will also be slow but as long as progress is made along the pandemic front, the second half of the year should pick up momentum.
All this depends heavily on the success of the Coronavirus vaccine and the most recent stimulus package, both of which remain uncertain.
A report from Dodge Data & Analytics indicates the 14% decline in the dollar value of construction starts in 2020 should see a 4% increase in 2021.
Dodge estimates residential starts are expected to rise 5% in 2021, following a 2% drop in 2020. Dodge forecasts single-family housing starts will rise 7% in 2021, to $254 billion, which would be the highest since 2007.
Multifamily starts are on the decline, seeing a 14% dip in 2020. Dodge does not see a rebound in that sector in 2021.
Analysts say lower mortgage rates are a driving force offsetting economic concerns. Another factor could be the migration of workers away from cities, due in part from the remote work demand stemming from the pandemic.
Data shows sales have outpaced construction, resulting in promising numbers but also somewhat of a materials shortage.
Commercial starts dropped nearly a quarter down 23% but analysts see a 5% bounce back in 2021.
Hotel construction really took the brunt of the 2020 pandemic, falling 46%. Dodge predicts it won't be as bad in 2021 but doesn't see it turning around either.
Retail construction also took it to the chin by the pandemic. Several companies filed for bankruptcy. The coronavirus only added to the trend away from walk-in to online retail.
Though the economy will start a rebound in 2021, economists believe it won't be until 2022 when Americans will notice a significant recovery. This of course is assuming the pandemic is a nothing more than a distant memory.
Recovery will also be a state-by-state proposition depending on how local governments approach the pandemic.
