I received a bit of a teasing prod this morning from my good friend the editor of CJ, Aaron Morby, when he rang me up to quiz me on house building targets.
"Don't you think we are seeing a recovery in house building?" Which he followed with: "I hope you don't miss it."
He was at the SED show and there was a buzz about house builders opening up new sites. There has been a bit of talk about this for a while now.
This is all very exciting for the groundwork people who have been starved of this work for a fair while now, but frankly it doesn't say that much about a recovery in house building.
That said I remain of the view that if you are looking for a growth potential in a construction market sector then house building is the one to start looking at.
Before getting too excited, it is worth noting that I am in the same camp as John Stewart of the Home Builders Federation on the recovery in house building.
"Even if the market is nearing the bottom, it is definitely too early to assume this will be followed by a recovery," he says in the latest issue of Housing Market Report.
The house building market is at an historic low and it will take some while to recover to the levels it was at in 2007, let alone to reach the targets set by Government before the crash.
However I rehearsed an argument for targeting the housing market ahead of other building sectors in an article for Barbour ABI's latest Construction Review. So it may be worth running through the points.
The essence of the piece was, firstly, I don't think a recovery in house prices is likely this year. But the relationship with house price growth and house building activity is not a simple one, so it is worth not muddling the two as people often do.
And I think construction work on new homes this year will plunge to previously unthinkably low levels. 2009 will most likely stick out in the history books as the worst ever peacetime year for house building activity.
Despite all that I really do think that it is time for wise firms to start to plan a strategy for the house building market.
The reasons here are two fold.
Fold one: Leaving aside infrastructure, every other sector is following behind the house builders and diving into recession. This means that the number of edgy contractors underbidding to win work in non-resi sectors will grow.
The chances are, if the industry players run to type, that non-resi projects will become increasingly awkward places in the coming months, as contractors try to claw back margins they eschewed in a bid to win turnover. And I will not be surprised if we will see a spate of nasty conflicts on projects over the next couple of years.
Think house builders over the past year and the pressure they put on the supply chain and that is what may well happen in non-resi. At least with house builders you know they are at the bottom and the beating they give you at the outset may be harder, but on balance it is more likely to be adhered to as the work progresses.
Against this background residential development clients don't look so bad. In construction to be successful it is not just about how much work you do, it is as much about who you do it for.
As an aside while on the subject of which are the most promising clients, I am regularly gobsmacked by the numbers of seemingly sensible people who keep telling me that they are eagerly looking for work in the public sector. Why would you leave a leaky boat to expend untold energy swimming in shark infested waters to get aboard a ship that is set to be torpedoed ? Me, I would just sit tight and bail like hell.
Fold two: House building will fall hard this year and by virtue will have more scope for a sizeable bounce back. Much of the decline, especially in front-end work, has been a result of the need to destock. As we have seen in the car industry this can lead to shutdowns while inventories are reduced.
But as Mervyn King, Governor of the Bank of England, likes to point out, a sharp downward readjustment in the stock cycle tends to lead to a sharp rise once stocks have been reduced.
And he pointed out again today the significance of the stock cycle during the Inflation Report press conference. This in part is a factor in the Bank suggesting a V-shaped recession as its central forecast for GDP growth.
House builders have to build at some point if they are to sell homes. And we are already seeing signs of new sites being opened up, selectively, and as Aaron Morby was keen to point out this morning there's a buzz about the SED show on this very subject.
As John Stewart points out, in Housing Market Report in his analysis of the HBF survey: "... the latest results show house builders have largely cleared their excess work in progress and stock." So, opening up of new sites is not necessarily a sign of recovery, but encouraging nonetheless.
In a sense it is the severe depth of the house building recession that will in itself make strong growth more likely in the years ahead. That is if you believe there is a demand and need to build homes at a rate of more than 100,000 a year.
Certainly, it is the view of many of the forecasters, such as those at the Construction Products Association, that we should see strong growth for house building starting in 2010.
Before we get too carried away this will be from a low base. But it is generally better to be in at the bottom of a rising market than the top of one that is tipping into decline.
And anyway, it may take you six months to a year to see the results of your strategic planning if you start now. By then the world will look different.