On June 24, the National Kitchen & Bath Association (NKBA) released the results of its modified 2020 Kitchen and Bath Market Outlook, updated to account for dramatic changes in the industry resulting from the COVID-19 crisis. The report places the value of the residential K&B industry at $130.8 billion, and also includes a consumer study illuminating the latest attitudes toward remodeling.
Consumers cited fewer resources; fear of outsiders coming into the home; limited access to industry professionals; store and showroom closures; less income and fear of job loss as hurdles to home improvement during the crisis. At the same time, however, there were bright spots, including more free time; decreasing expenditures in other areas; an opportunity for DIY work; increased time spent at home and a focus on home projects.
"Our initial 2020 Kitchen & Bath Market Outlook was conducted in late 2019, before the pandemic hit our members and homeowners in the U.S. & Canada," said Bill Darcy, NKBA CEO. "Kitchen and bath spending had been increasing steadily prior to the pandemic at 9 percent in 2018 and 4 percent in 2019. As such, the original report projected a strong 2020, bolstered by an especially bright Q1. While the COVID-19 crisis, unsurprisingly, led to a double-digit decline in spending across all major categories, we are already seeing signs of positive growth as shelter-in-place orders are lifted, and we're optimistic about the industry's long-term health."
NKBA commissioned the highly regarded consulting firm John Burns Real Estate Consulting (JBREC) to field the study. Selected highlights of the updated report include the following:
The kitchen and bath market tends to recover more quickly than other indicators in times of economic uncertainty, and it is intimately tied to the housing market. A strong housing market is often reflected in healthy remodeling growth, and applications to purchase a home are once again on the rise after a major decline at the start of the COVID-19 crisis. While applications are still below pre-pandemic levels, with mortgage rates 1 percent lower than they were in 2019, there are positive signs for consumer spending ahead.
Additional key consumer insights and spending habits include the following:
The data presented in this report is compiled from a variety of sources: The U.S. Census American Housing Microdata, National Apartment Association (NAA) Spending, National Association of Realtors, Moody's Analytics, Home Innovation Research Labs (HIRL) data, and JBREC's home improvement estimates and forecasts. In addition, a survey was conducted among 500 consumers to better understand the impact of the COVID-19 pandemic on spending levels.