A new report published by the American Institute of Architects (AIA) indicates that architects who focus on residential projects are bracing for steep losses over the coming months as the COVID-19 economic shut down put in place to limit the spread of the novel coronavirus has dimmed what was projected to be a year of healthy growth.
The report’s findings state, “With years of overbuilding, the large millennial generation reaching their prime home-building years, and mortgage rates near historical lows, the outlook was bright for the housing sector entering 2020. Most forecasters were expecting housing production to average 1.5 to 1.6 million units per year over the coming years.” All of that, however, has come to a screeching halt as a hodgepodge of work shut downs and other initiatives have slowed new construction across the country.
“Just as the residential sector was getting back on a solid foundation, it has been hit with this setback,” writes AIA Chief Economist, Kermit Baker, Hon. AIA, PhD in a statement supporting the report. Baker adds, “Until we have a better understanding of when the homebuilding and home improvement industries can resume their normal pace, demand for residential design activity is expected to suffer.”
The report, which dovetails on an earlier survey of non-residential focused firms published a few weeks ago, finds that 70% of firms indicate that inquiries for new work declined in March and that 78% of firms have already seen slowing or stoppage of projects.
In addition, roughly 90% of firms have seen problems with current projects due to COVID-19.
According to the survey, “most residential firms, about two thirds, indicated that virtually all/majority of their staff are now working remotely.”
Further, the economic losses resulting from the virus are expected to grow. The report states, “Residential firms anticipate accelerated revenue losses in April, with almost 70% expecting losses of 10% or more for the month relative to their expectations in early March.”
To help collect and digest the latest COVID-19 related architecture news, Archinect has put together a COVID-19 guide for architects and designers here. For economy- and construction-specific news, check out Archinect’s Guide to 2020’s Economy and Business news. Both of these articles are updated every Wednesday.
2 Comments
I find this graphic compelling, and definitely a big reason why we need The Architecture Lobby. 32-33% of member firms, believe that their labor force, is expendable. It's likely telling that that same number represents firms, who support opening the country back up, fuck whatever that "deep state mole" tells us.
I recently spoke with a young recent graduate who is working for a medium sized archi firm specializing in residential work. As of last week they were hiring and he reminded me their clients are all "rich".
With the huge disparity in income (and sources of income) is it possible that historic records may not support the current national financial condition? Realistically stated in another way, how many people with incomes of less than $250K/YR hire architects to design their homes?
Not sure where I heard or read this, but so called millennials are not lusting for McMansions these days and are more likely to be outfitting their vans to travel the continent or the world. The pandemic may just be accelerating change for us all.
Block this user
Are you sure you want to block this user and hide all related comments throughout the site?
Archinect
This is your first comment on Archinect. Your comment will be visible once approved.