According to a report from Fitch Ratings, after years of economic turmoil, US homebuilders should see modest gains with a stable outlook in 2012.

The agency expects mild improvements in construction, with a 6.7% increase in residential housing starts, new home sales growth of 5.6% and an existing home sales increase of 3%. Home improvement spending is projected to increase by 4%.

Commercial construction spending is expected to improve by 4% in expenditures, but lack of credit and weak fundamentals may deter growth.

Public construction is forecast to remain flat as state and city budget improvements are expected to be offset by the winding down of 2009 stimulus funding. Highway and bridge spending is expected to be restrained as states are reluctant to commit to long term projects without a multiyear highway bill.

Prices for raw building materials are expected to remain high, but not increase. Liquidity among both builders and home products companies is expected to remain strong.

(Sourced from www.ibtimes.com)