Texas’ manufactured housing production remains resilient despite February winter stormTexas’ manufactured housing production remains resilient despite February winter stormhttps://www.recenter.tamu.edu/news/newstalk-texas/?Item=256372021-03-10T06:00:00Z2021-03-10T21:00:00Z

​​​COLLEGE STATION – Winter Storm Uri prompted a weeklong freeze in production, according to the latest Texas Manufactured Housing Survey (TMHS), with the combination of cold weather and ensuing power outages damaging infrastructure and equipment. The weather shock, however, subsided by month-end, and the respondents noted increases in daily production with future gains on the horizon.

"Texas manufactured housing plant production was back above pre-pandemic levels to start 2021, but Uri surely dampened shipments by some amount," said Rob Ripperda, vice president of operations for the Texas Manufac​tured Housing Association (TMHA). "February is typically an inventory buildup month for retailers, so we’ll see if the disruption caps or pushes back sales."

The TMHS corroborated the inventory expansion with the backlog index reaching a five-month high, while sales activity leveled off from January.

"The start of the spring season is here, and consumer-search data suggest the buyers are coming," said Ripperda. Manufacturers, however, did not share that sentiment with a sluggish sales index projected over the next six months.

The industry experienced widespread inflationary pressure with all respondents noting increases in raw materials.

"The most recent numbers from the Bureau of Labor Statistics show a 73 percent increase in the price of lumber in the past 12 months," said Dr. Harold Hunt, research economist at the Texas Real Estate Research Center (TRERC) at Texas A&M University. "Add in the recent bump in the price of transportation fuels, and cost increases can become pretty meaningful to manufacturers."

Prolonged supply-chain disruptions have contributed to the inflationary environment, but recent cutbacks in lumber tariffs may provide relief in coming months. Some of the costs have been absorbed through higher prices received for finished goods.

Despite these challenges, Texas’ manufactured housing industry remained optimistic heading into the spring selling season and expanded payrolls accordingly.

TRERC and TMHA have partnered to produce a monthly survey of business conditions and expectations surrounding the manufactured housing industry. 

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