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| Jun 12, 2013 |
Interior design & housing market rise, architecture loses ground
Boh staff
By Staff

The American Society of Interior Designers (ASID) released its quarterly Interior Design Billings Index last week, which reported that the first quarter of 2013 ended on a high note, jumping six points to 61.0 from the quarter ending in December 2012. And, according to the National Association of Home Builders/First American Improving Markets Index, the number of U.S. housing markets on the mend rose by five to a total of 263 in June.

The Improving Markets Index identifies metropolitan areas that have shown improvement from their respective troughs in housing permits, employment and house prices for at least six consecutive months.

Twenty-nine new markets were added to the list while 24 others were dropped from it this month. New entrants included such geographically diverse metros as Salinas, CA.; Sioux City, IO; Chicago, IL.; Topeka, KA.; Baton Rouge, LA.; Laredo, TX; and Philadelphia, PA.

By comparison, the American Institute of Architecture (AIA) Billings Index lost ground in March, dropping to 51.9, although it remained in positive territory, capping a positive quarter for the architecture industry as well.

The ASID also reported that interior design inquiries also rebounded, rising to 64.7 from 63.3 in February and 64.2 in January.

Here is a closer look at the Interior Design Billings Index:

Performance Averages Across Industry Sectors

- Residential (single family and multi-housing): 53.5  (vs. 51 for Q4 of 2012)

-  Commercial (retail, entertainment, office, hospitality): 49 (vs. 47.5 for Q4 of 2012)

- Institutional (healthcare, government/institutional, education): 44.9 (vs. 46.2 for Q4 of 2012)

All areas of the country reported gains in regional economic growth in March, led by the Midwest, which posted an index score of 61.7, up over 10 points from February. Business performance in the West continued to improve after several months of weak postings, up over seven points from February to reach 59.5. The South continued to improve gradually, posting a more modest gain of 2.8 points, at 63.7, compared to 60.9 in February. The Northeast, which along with the Midwest has struggled through recovery, sustained another month of positive performance, at 56.5, making up for a decline in February, when it dipped to 51.7.

Smaller firms, either sole practitioners or those with five or fewer employees, reported improved performance in March, up 7 points and 5.9 points, respectively. Mid-size and large firms, however, experienced a decline in billings, a negative 10.8 and 8.3, respectively, perhaps due to the slowdown in some commercial and institutional sectors.

In March, the ASID Business Outlook score was 74.0, the same as in February but up from the prior quarter’s index of 66.7. When asked about recent hiring, 11% of responding panelists hired at least one new employee in the past three months, and 10% indicated they would hire in the next three months. Most of these recent and anticipated hirings were among sole practitioners and small firms. Despite some gains in consumer confidence and employment figures, designers by and large remain cautious and concerned about their prospects for 2013. At present, opportunities appear to be most plentiful for residential designers, buoyed by the resurgence in the housing market.

Launched in November 2010, The ASID Interior Design Billings Index tracks performance data for billings, inquiries and product sales specific to the interior design industry. The index is based on a monthly survey of 300 firms and provides a tailored perspective on billings, business conditions and economic outlook. The results are compiled into diffusion indexes centered on 50, with scores above 50 indicating an increase in billings, and scores below 50 indicating a decline.

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