If you asked remodelers how 2020 would play out at the beginning of the pandemic, very few would have predicted a year-over-year industry increase amid a plummeting economy and high unemployment. But as the year comes to a close, the industry is finishing strong enough that the National Kitchen and Bath Association predicts a 1.1% increase year-over-year compared to 2019 based on its Kitchen & Bath Market Index (KBMI), which predicted negative sales for the year in previous reports.
“As we approach the end of an unprecedented year, the industry outlook is promising,” said NKBA CEO Bill Darcy. “While COVID-19 will continue to present challenges to the supply chain, labor and spending, we’re grateful to be one of a few industries that has actually seen growth in response to consumers spending more time at home and looking to make their spaces more functional in this new normal.”
Q3 breathes life into the kitchen and bath industry
The explosion of business in the second half of the year is driving this surprising industry turn. For the first time this year, the KBMI scored above 50, indicating an expansion at a reading of 61.9. More than half of the companies surveyed reported that the pandemic drove higher demand in Q3, according to the survey by the National Kitchen & Bath Association (NKBA) and John Burns Real Estate Consulting. Comparatively, the index readings below 50 in Q1 and Q2 indicated an industry contraction as companies dealt with material shortages, supply chain disruptions, and economic uncertainty.
Future opportunities and challenges for the kitchen and bath remodeling industry
Though small jobs and DIY have reigned supreme during the early days of the pandemic, 2021 may bring new opportunities for remodelers looking to book large-scale projects. Designers are seeing a return of higher bids and discretionary spending, and the time at home has given homeowners a new view of their needs. “Consumers have undertaken a lot of remodeling in 2020, but significant opportunity remains, especially for the kitchen and bath market, going into 2021,” Todd Tomalak, principal at JBREC, says. “For many families working and schooling from home, 2020 wasn’t the ideal time to redo a space as essential as the kitchen or bathroom. As such, we anticipate continued activity for kitchen and bath remodeling next year.”
We anticipate continued activity for kitchen and bath remodeling next year.
Still, challenges remain for kitchen and bathroom remodelers. Those surveyed rated supply chain disruptions as the industry’s greatest challenge, and the long term effects of COVID-19 are still unknown. While over a third of the industry does not expect another shutdown, 24% expect another shutdown and another 39% are unsure.