The National Kitchen & Bath Association (NKBA) has released its Market Outlook report showing the remodeling industry is largely recovering from its Q1 COVID-19-induced dip. According to the report, the percentage of homeowners actively working on remodeling projects increased significantly, from 19 percent in Q1 to 36 percent in Q2.
Additionally, more than one in five households (22 percent) wants to remodel soon, and many increasingly cite the need for more functional space as a driving factor. A significant percentage is also motivated to replace worn-out features (20 percent), repair damage (15 percent) and update their home’s design (14 percent).
“We continue to be extremely encouraged by the vigorous interest in home improvement and functional living, which has certainly contributed to the healthy industry rebound we’re seeing,” said Bill Darcy, NKBA CEO. “Even as restrictions lift in parts of the country, people continue to spend far more time at home than they did pre-COVID, and the kitchen and bath play major roles in a family’s health and wellness. Consumers are, understandably, still careful about spending, but as the economy continues to reopen and improve, we expect smaller DIY projects will lead to more significant renovations, boosting both industry revenue and homeowner satisfaction with their living spaces.”
The study also included a survey of homeowners in various stages of considering or executing a kitchen or bath renovation project, and the following insights shed light on how COVID-19 has changed the way people interact with their living spaces:
Due to a combination of smaller DIY jobs and cautious spending, low-cost projects will decline only 1 percent from last year, while mid- and high-spend will drop 10.1 percent and 5.2 percent, respectively. Nearly one-quarter (24 percent) of households planning projects in 2020 cited limited finances as an impact of COVID-19. And while 55 percent of those who canceled projects did so due to the pandemic directly, 34 percent did so because project costs were outside their budget, up from 27 percent of households in the prior quarter.
Still, the valuation of the residential kitchen and bath industry is climbing, despite setbacks from the COVID-19 pandemic. Spending in 2020 is anticipated to hit $139.1 billion, down only 6.1 percent from 2019, and up from the expected decline of 11.7 percent predicted last quarter.
Additional economic indicators that may contribute to increased remodeling activity include the following:
The data presented in this report is compiled from a variety of sources: The U.S. Census American Housing Survey home-improvement projects microdata, National Apartment Association (NAA) spending (rental), and John Burns Real Estate Consulting’s home improvement estimates and forecasts of single-family rental renovation spending. In addition, a survey was conducted among 1,048 consumers inquiring about their household kitchen or bathroom remodeling projects.