The National Kitchen & Bath Association (NKBA) recently released its 2008 Kitchen/Bath Industry Outlook, which reports that kitchen and bath remodeling continues to be a source of strength in the industry amidst sharp declines in new construction, though 2008 will see an overall slowdown. According to the association, several market factors will drive kitchen and bath remodeling through 2008; among them are:
A sluggish real estate market will prompt those hoping to sell their homes to make improvements to entice buyers.
Sinking home values will encourage homeowners remaining in place to improve and upgrade their kitchens and bathrooms to boost their home’s value and enhance their lifestyle.
Economic conditions intensify the urge to cocoon, stay close to home, and re-create the home as a getaway in its own right with kitchens that allow multiple functions and socializing, as well as spa-like bathroom retreats.
Magazine, Web, and television focus on home design and products continues to feed homeowners’ desire to replace current materials and products with the latest design trends.
Baby boomers aging in place and caring for elderly parents will seek to make their kitchens and bathrooms more accessible to those with limited mobility.
The focus on green and energy-efficient homes along with increasing water shortages and energy costs will lead some homeowners to replace current kitchen and bath appliances and fixtures with those that use less energy and less water. These and other factors will continue to drive kitchen and bath remodeling at all income levels in 2008 and beyond, says the NKBA.
The 2008 Kitchen/Bath Industry Outlook also offers two predictions for the year ahead: an optimistic “soft landing” forecast and a pessimistic “hard landing,” based on different housing industry and economic scenarios.
The NKBA’s “soft landing,” based on the National Association of Home Builders’ forecast for housing starts along with little increase in unemployment rates, would see a 5 percent dip in kitchen remodeling to 8.5 million units with spending dropping 13 percent to $110.3 billion. Bathroom remodeling would dip 4 percent to 14.3 million jobs and a 10 percent decrease in spending, down to $84.3 billion.
The association’s “hard landing” is based on the scenario of a national recession, lower housing starts, and higher unemployment rates. These conditions would lead to an 8 percent drop in kitchen remodels, down to 8.2 million units, with spending falling 16 percent to $106.7 billion. Bathroom remodels would decrease 9 percent to 13.7 million units with a 12 percent decline in spending at $81.8 billion.
