Housing Growth Good For Pay TV


ISI Group housing market analysts predicted that new housing starts should rise 24% next year to 1.2 million, a gain that their counterparts on the media side of the house estimate should bode well for pay TV providers.

According to research conducted by a handful of ISI Group analysts led by Ed Hyman and Nancy Lazar, lower mortgage rates, improved house price expectations and a decline in inventories should lead to a surge in new housing starts in 2013. The ISI analysts estimate that about 850,000 new homes will be built in 2012, rising to 1.2 million in 2013.

ISI Group media analysts Vijay Jayant and David Joyce wrote in a separate note that the surge should be good news for pay TV service providers, who have seen a slowdown in subscriber additions as the sluggish economy has battered the housing market.

“The pay TV industry will be a natural beneficiary of a higher base of occupied homes,” Jayant and Joyce wrote in a note to clients. But the two analysts stopped short of predicting how much of an impact the rise in housing starts would have on cable, satellite and telco TV subscribers, adding that there are still too many variables in the housing market to come up with a hard number.

“Simply put, in the long run, we believe that pay TV net adds will benefit from this increase in housing starts but that data has low short term predictive relevance,” Jayant and Joyce wrote.