Projecting housing starts and softwood lumber consumption in the United States
New residential construction is a primary user of wood products in the United States; therefore, wood products projections require understanding the determinants of housing starts. We model quarterly US total, single-family, and multifamily housing starts with several model specifications, using data from 1979 to 2008, and evaluate their fit out of sample, 2009 –14. Goodness-of-fit statistics show that parsimonious models outperform general models in out-of-sample predictions. Monte Carlo simulations of total housing starts to 2070 project median starts ranging from 0.86 million/year at 0% real gross domestic product (GDP) growth to 1.91 million/year at 5% real growth, with 90% uncertainty bounds ranging from 0.52 to 2.13 million/year. Assuming that future GDP growth equals the average rate observed over 1990 –2015, there is less than 9% probability that housing starts will exceed 2.0 million in any given year, 2016 –35. Results show no evidence of structural change in the determinants of total or single-family housing starts coincident with the recession of 2007– 09. Using these housing projections in a softwood lumber consumption model shows that GDP growth slower than 2% is consistent with stagnant or declining median softwood lumber consumption.
Requesting Print Publications
Publication requests are subject to availability. Fiscal responsibility limits the hardcopies of publications we produce and distribute. Electronic versions of publications may be downloaded, distributed and printed.
Please make any requests at email@example.com.
- This article was written and prepared by U.S. Government employees on official time, and is therefore in the public domain.
- Our on-line publications are scanned and captured using Adobe Acrobat. During the capture process some typographical errors may occur. Please contact the SRS webmaster if you notice any errors which make this publication unuseable.
- To view this article, download the latest version of Adobe Acrobat Reader.