The New Year began the same way the previous year ended, with record demand for residential remodeling, affordability issues impacting the housing sector and several headwinds that threaten to hamstring future growth. Among the key statistics and forecasts released in recent weeks by government agencies, research firms and industry-related trade associations were the following:
Companies in the residential construction and remodeling sectors were anticipating “strong activity” as 2021 wound to a close, although many firms report steady increases in backlogs since the beginning of the COVID-19 pandemic. According to latest Houzz Renovation Barometer, the industry witnessed “some settling of home renovation and design activity following record high performance earlier in 2021…with many businesses struggling to catch up with heightened demand as they navigate supply chain challenges and labor availability.” More than half of surveyed firms in both the construction and architectural/design services sectors report challenges with product and material shortages and increased costs, said Houzz, the Palo Alto, CA-based online platform for home remodeling and design. More than nine in 10 construction businesses reported moderate to severe skilled labor shortages, Houzz added (see related graph, above).
The outlook for existing-home sales, which reached a 15-year high of 6+ million units in 2021, “continues to be promising,” according to the chief economist for the National Association of Realtors. Speaking at the NAR’s recent annual Conference & Expo in San Diego, economist Lawrence Yun said that he expects the nation’s resale market to continue its recent success, based on an anticipation of additional inventory in the coming months, but doesn’t anticipate this year’s performance to exceed that of 2021. Yun added, however, that although there may be a decline in existing-home sales in 2022, he forecasts that resales will outperform pre-pandemic levels, amid signs “that a more normal…market is on the horizon.”
CABINET & VANITY SALES
Major domestic kitchen cabinet/vanity manufacturers continued to report “healthy” sales through November of 2021, according to the latest “Trend of Business Survey” by the Kitchen Cabinet Manufacturers Association. The survey reports a year-to-date sales increase among participating cabinet manufacturers of 14.6% through November, compared to the same 11-month period in 2020. Custom cabinet sales through the first 11 months of 2021 were reported up 20.1% over the same period the previous year, while semi-custom sales rose 10.8% and sales of stock cabinets gained 16.2%, the Reston, VA-based KCMA said.
Reflecting gains in new construction and residential remodeling, domestic shipments of major home appliances continued their year-long climb through the third quarter of 2021, the Association of Home Appliance Manufacturers reported. According to AHAM, a July-through-September decline of 2.4% compared to the same quarter a year ago was not enough to thwart an overall year-to-date gain of 16.0% in major appliance shipments compared to the same nine-month period in 2020. Year-to-date shipments through the third quarter of 2021 totaled 66.7 million units, compared to 57.5 million units shipped in the third quarter of 2020, AHAM reported.