Kitchen Cabinet Refacing and Remodeling Predicted to Grow
It’s no secret that the recession was a difficult time for the construction industry. But while new home construction fell sharply, Americans continued to remodel.
Although new construction suffered greatly during the recession, remodeling work held tight — dropping from $326 billion in 2007 to $286 billion in 2009 before rebounding back to about $300 billion in 2010 according to Harvard University’s Joint Center for Housing Studies.
The research institute singled out specialty contracting firms like Kitchen Solvers for their ability to navigate even the worst of the recession, thanks to streamlined operations, focus and efficiency.
Now we’ve turned the corner. The institute expects remodeling spending to rise 3.5 percent a year through 2015 — with about 25 percent of that spending going to kitchens and baths.
The optimism is driven by a demographic bulge: the Baby Boomers are getting older, and if they behave like the predecessors who hit retirement age from 1997 to 2007, a lot of them will be selling their longtime homes and looking to downsize. That will create a surge in remodeling.
“Housing Turnover by Older Owners,” a study by the Joint Center for Housing Studies, predicts that Baby Boomers will follow the lead of previous generations by downsizing into smaller homes and releasing “a very large amount of housing onto the market. … The inevitable turnover of housing units will have considerable implications for home improvement spending as the new occupants update or reconfigure homes to fit their needs.”
The Harvard study notes that when older homeowners sell, the buyers tend to be younger homeowners who “undergo considerable renovation and repair activity immediately after the sale.”
The housing price collapse hurt the ability of many people to tap their home’s equity for home improvement projects, and low mobility in the housing market has meant that many Boomers are living in their homes longer than they intended. The result is a lot of deferred maintenance and sidelined home improvement projects.
Harvard expects younger buyers to pick up the slack. And when they do, “in addition to spending more on remodeling, buyers are more likely to spend a greater share of their remodeling dollars on kitchens and baths,” the report says.
The National Association of Home Builders is seeing that play out as the housing market improves. In January, the NAHB saw its Remodeling Market Index (RMI) hit its highest level since 2004.
“With existing home sales up, the increase in the RMI partially reflects the remodeling work new home owners undertake when they move in,” said NAHB Chief Economist David Crowe in a news release. “Consumers are gaining confidence in the economy and feeling more comfortable pulling the trigger on large and small renovations.”
Kitchen Solvers is well positioned to benefit from both Americans’ eagerness to remodel and their desire for value. Our volume buying of new cabinets and our refacing options allow us to deliver extraordinary kitchens at a variety of price points. We have a track record of saving customers thousands of dollars — and for people who increasingly watch their checkbook, that makes Kitchen Solvers a very attractive option.
Just ask Tom and Pat Falbo of Spring Grove, Minn. When they decided to update their kitchen, they headed to a giant hardware store to check out cabinets. The cabinets and installation cost would have been $25,000. That was far too much money. They called Kitchen Solvers and learned that a cabinet reface would cost about $6,000.
“We think it was an excellent value,” Pat Falbo said. “They put on solid cherry doors — you wouldn’t know they’re not new cabinets.”