Analysts see foreclosures, price volatility and tight money stalling HVAC’s return to health until 2012

May 01, 2010 | 06:19 AM | Lisa Gordon

With construction industries still challenged by tight credit markets and weak demand, a more-stable, climate-controlled atmosphere doesn't appear to be in the immediate cards for the heating, ventilation and air conditioning (HVAC) sector.

HVAC is inextricably tied to construction, providing the ductwork necessary in any new building. And even if residential projects pick up this year, the commercial side of the business is still seeking bottom.

Slow sales, high inventory levels and a weak pricing environment are still plaguing residential construction, according to the Portland Cement Association (PCA), a Skokie, Ill.-based construction trade group. "Despite recent data suggesting increased sales activity, foreclosure improvement and inventory reduction, the environment for a sustained improvement in single-family housing starts may not be as positive as it seems," PCA chief economist Ed Sullivan said. "Homebuilders are unlikely to accelerate construction activity until two critical conditions are met low inventory levels of unsold new homes and stable or rising home prices."....

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