Postcards from the Show
As a result of too much good material and not enough space, here is a collection of semi-random notes from the International Builders’ Show in Orlando, Fla.
• Question: Does anybody really pay $99 a day for Internet connection — the asking price at the convention center?
• I told my cab driver what I was doing in Orlando.
“That’s funny,” he said.
“Because I must have taken a dozen people to and from the Builders’ Show, and I haven’t met an actual builder yet.”
There are two kinds of work, I explained to the driver, paraphrasing philosopher/mathematician Bertrand Russell. The first is moving and building heavy objects at or near the surface of the earth. The second is telling other people to do so. The first is hard work. The second is much more pleasant. (Now that’s a tip.)
• The builders I spoke to in Orlando had a near unanimous response to the stock question: “How’s business?” By far the most common was: “We’re doing well.” The emphasis was always on “we’re,” with the insinuation that competitors couldn’t claim the same. The worst report I heard was, “We’re doing OK.”
I explained the findings of my unscientific survey to a builder from Pittsburgh who promptly shredded my experiment as biased and flawed. “All the builders here in Orlando are doing well,” he said. “The ones who aren’t, well they’re back home trying to figure out how to stay in business.”
But maybe there’s another interpretation. The builder who recognizes the value of the kind of networking and education available at events like the International Builders’ Show are the kinds of builders who are going to be in good shape.
Just a thought.
• Credit to NAHB chief economist David Crowe for doing something extraordinary and refreshing. Before delivering his forecast for 2011, he revealed to the audience his forecast for 2010, which was off by a long shot (but closer to reality, he pointed out, than other forecasts). Bravo! Disclosure of past forecasting accuracy (or inaccuracy) is too often neglected. This should be standard operating procedure for all economists standing at a podium and talking about the future.
• Best description of pent-up demand, social trends and residential construction: “It’s only so long that a 30-year-old can live in his mom’s basement,” said NAHB’s Crowe.
• Overheard in the pressroom: “Does America need another manufacturer of faux stone products?” Remembered from Economics 101: “The American market will answer that question.”
There is always room for an innovator. Even in a crowded market, if a company can provide a value proposition to its customers, then it’s in.
• With his prediction for a 20% increase in housing starts, Frank Nothaft, chief economist at Freddie Mac, put the stat in perspective. If a typical builder built 25 houses during the market peak, this same builder produced only five houses in 2010, following form. A 20% increase in 2011 would mean this same builder would increase production to just six houses this year.
• I’ll take it.
— Ken Clark