Outlook Points to Record 2022 Revenue, Despite Headwinds

by Anita Shaw

HACKETTSTOWN, NJ — Kitchen and bath revenue will continue to post strong growth in 2022, rising to record highs even in the face of lingering product/labor shortages and rising inflation, according to a newly released forecast.

The National Kitchen & Bath Association’s annual Kitchen & Bath Market Outlook, produced in conjunction with the John Burns Real Estate Consulting firm (JBREC), projected that the 2022 market for residential kitchen and bath new construction and remodeling is poised to experience a 19% year-over-year increase in spending for the second consecutive year, from $167 billion to $199 billion. The analysis is based on government and industry sources, as well as JBREC’s internal forecasting, said the Hackettstown, NJ-based NKBA, noting that “a continued strong home market and an increase in home value bodes well for the kitchen and bath industry as homeowners look to capitalize on their home’s equity.”

While rising costs will drive some homeowners to pursue do-it-yourself projects, 85+% of 2022 remodeling projects, accounting for an estimated $173 billion in revenue, will include professional involvement, according to the NKBA. The kitchen/bath remodeling sector is forecast to gain by 16%, with kitchen remodels expected to grow by more than 20%, and bathrooms by 18%. Mid-spend projects will lead the market, with annual growth of more than 25%, topping the anticipated 21% growth for low-price-point projects. High-end projects will likely pull back from their robust 2021 pace. New construction, expected to account for revenues of nearly $120 billion, is being forecast to rise by 21% over 2021, much of it due to the completion of delayed projects and price inflation.

“As we begin 2022, the industry continues to be optimistic and is forecasting continued rapid growth in both new construction and remodeling,” said NKBA CEO Bill Darcy. “Even with this increasing demand, however, we cannot dismiss the current risks we’re facing,” he added.

According to the Market Outlook, the impact of labor availability – due to both the COVID-19 pandemic and unfavorable demographics – will remain an obstacle to more robust growth, leading to major backlogs as the completion of projects become delayed. Additionally, growing demand will continue to exacerbate ongoing supply chain challenges, the forecast noted.

 

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