Experts at LP Building Solutions, a manufacturer of high-performance building products, offer their analysis and predictions for the 2023 housing sector:
- How the general state of the economy will impact the building industry in 2023
- What lessons the industry learned from the pandemic, and what impacts are here to stay
- LP predictions for what the housing industry can expect in 2023
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RISING MORTGAGE RATES WILL DAMPEN DEMAND
"Rising mortgage rates will challenge the home building industry in 2023 and dampen demand growth for housing. The landscape will be more competitive. There will continue to be opportunities for growth and success, but that growth and success will come to companies and products with a strong value proposition." – Brad Southern, Chair and CEO
"The market will rely more heavily on rentals, and people will stay in their homes longer. Customers are worried about a recession, yet they understand that there is still a huge need for homes." – Susan Soine, General Sales Manager
"We’re coming off a few very strong years for the housing market. While there is some uncertainty on how 2023 will fare, we’re still very optimistic about the continued strength over the next 5+ years. The underlying demand for housing remains strong, so regardless of how the next 12 months unfold we expect the industry to continue investing in growth, new innovations, and operational excellence." – Jeff Yelle, Vice President, Chief Information Officer
LESSONS FROM THE COVID-19 PANDEMIC –
AND WHAT IMPACTS ARE HERE TO STAY
"COVID-19 taught us that agility is the most important attribute of success for individuals, teams, and companies. As we face continued challenges associated with rising mortgage rates, companies that demonstrate agility in operations, sales and financial management will continue to see success." – Brad Southern, Chair and CEO
"The pandemic underscored the importance of strong and transparent partnerships with suppliers. Having relationships and partnerships in place with outside vendors helped manufacturers secure necessary materials." – Jimmy Mason, Executive Vice President, General Manager of Siding
"Ecommerce, consolidation, and a stronger alignment between builders, manufacturers, and suppliers are impacts that are here to stay. Strong partnerships along the supply chain are more important than ever. Suppliers, manufacturers, and builders are all having to be more intentional about communicating better with each other. Until the past few years our industry has been fragmented, each stop along the supply chain working in their own lane. I think that we are all realizing how important partnerships are and are getting lessons in how to better cultivate those relationships." – Craig Sichling, Vice President of Specialty Sales and Marketing
"Leaning into technology has the potential to make information more accessible to all parts of the supply chain." – Craig Miles, Vice President, National Sales, OSB Marketing and Planning
WHAT THE HOUSING INDUSTRY CAN EXPECT IN 2023
"Sustainability is a focus for many emerging trends in the construction industry. As a result, many builders are prioritizing energy and resource optimization along with reducing construction waste. While a recent trend for many, LP Building Solutions has been committed to environmental well-being for over 50 years. Our products are produced with 100% sustainably sourced wood fiber. LP TechShield Radiant Barrier and LP NovaCore Thermal Insulated Sheathing from the LP Structural Solutions portfolio are designed to improve the energy efficiency of a home. This is something the LP Structural Solutions team is really leaning into with purpose." – Sandra Bostian, Senior Manager, Marketing Innovation
"Managing the unprecedented labor and economic conditions that our country has migrated to will be top-of-mind for 2023. Either the industry will adapt or use it as an opportunity to refocus. Our products will allow us to thrive in this new era of building. Our products have been shown to install faster and offer real labor savings. I believe it’s a wonderful time to refine our approach to continue building better structures from the perspective of quality, performance, function, and sustainability." – Tom Hanzely, Senior Marketing Manager, Growth & Innovation, Siding
"The future of housing remains optimistic. It’s exciting to see the eagerness in the market among homebuyers wanting to capitalize on the American Dream. There is a strong opportunity, as housing remains underbuilt in the U.S. According to Housing Economist, we need to build on average 1.55 million homes a year for the next 10 years to catch up with the housing shortfall and meet projected demand. Our country doesn’t just need more homes—it needs homes that are built better.
"Homeowner preferences have shifted over the years. As young adult buyers come into their own in their careers and shed college debt, they’re not bringing with them preconceptions that new houses should be large merely in terms of square footage. Connectivity—to neighborhoods, outdoors, food, health, and social networks—is an important factor homeowners consider when buying and building homes." – Jimmy Mason, Executive Vice President, General Manager of Siding
"There continues to be a focus on evolving the building and energy codes. These changes always have the potential to emphasize the value of certain building solutions while also challenging solutions or methods that are less efficient or energy saving. We monitor and participate in the development of standards and codes so that we can help guide the industry to pursue the most robust and resilient solutions for today’s labor shortages and energy-conservation needs." – Jeff Yelle, Vice President, Chief Information Officer
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ABOUT LP BUILDING SOLUTIONS
As a leader in high-performance building solutions, Louisiana-Pacific Corporation (LP Building Solutions, NYSE: LPX) manufactures engineered wood building products that meet the demands of builders, remodelers, and homeowners worldwide. LP's extensive offerings include innovative and dependable building products and accessories, such as Siding Solutions (LP SmartSide Trim & Siding, LP SmartSide ExpertFinish Trim & Siding, LP BuilderSeries Lap Siding, and LP Outdoor Building Solutions), LP Structural Solutions (LP TechShield Radiant Barrier, LP WeatherLogic Air & Water Barrier, LP Legacy Premium Sub-Flooring, LP FlameBlock Fire-Rated Sheathing, LP NovaCore Thermal Insulated Sheathing, and LP TopNotch350 Durable Sub-Flooring), and oriented strand board (OSB). LP also provides customer service and warranties. Since its founding in 1972, LP has been "Building a Better World" by helping customers construct beautiful, durable homes. Headquartered in Nashville, Tenn., LP operates 22 plants across the U.S., Canada, Chile, and Brazil.
