by Calculated Risk on 2/04/2014 07:47:00 PM

Here is an optimistic outlook from NAHB economist David Crowe:

"My single-family forecast for 2014 is pretty aggressive--822,000 starts which is likely 200,000 more than 2013," said NAHB Chief Economist David Crowe. "There are five key points to the turnaround. Consumers are back, pent-up demand is emerging, there is a growing need for new construction, distressed sales are diminishing and builders see it."

Consumer confidence has returned to pre-recession levels and household balance sheets are on the mend. ...

Meanwhile, new-home sales are averaging just 8.7 percent of total home sales, barely half the historical average of 16.1 percent. ...

NAHB is forecasting 1.15 million total housing starts in 2014, up 24.5 percent from last year's total of 928,000 units.

Single-family production is projected to rise 32 percent in 2014 to 822,000 units and surge an additional 41 percent to 1.16 million units next year.

NAHB is anticipating 333,000 multifamily starts in 2014, up 9 percent from 306,000 last year.

Single-family home sales are projected to hit 584,000 this year, a 35.9 percent increase above last year's 430,000 sales

For 2012, Crowe forecast 360 thousand new home sales (actual was 368 thousand) and 501 single family starts (actual was 535 thousand). For 2013, Crowe forecast 447 thousand new home sales (actual was 428 thousand), and 641 thousand single family starts (actual was 618 thousand).  So he has been pretty close ... but his 2014 forecast is "pretty aggressive"!

Wednesday:
• At 7:00 AM ET, the Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

• At 8:15 AM, the ADP Employment Report for January. This report is for private payrolls only (no government). The consensus is for 170,000 payroll jobs added in January, down from 238,000 in December.

• At 10:00 AM, the ISM non-Manufacturing Index for January. The consensus is for a reading of 53.9, up from 53.0 in December. Note: Above 50 indicates expansion, below 50 contraction.