|By Bruce Isaacson President, Homestore.com, Inc. Home Services
"The overall economic outlook is good," said Dave Seiders, NAHBÆs chief economist at the 2000 RemodelersÆ Show in Detroit, "but the economic waters are rough right now."
According to the revised Census Bureau C-50 figures, remodeling expenditures totaled $142.9 billion in 1999, nearly 20 percent more than the $120 billion that had been estimated by the NAHB using earlier census data. Approximately $100.6 billion was spent on improvements and $42.2 on maintenance and repair.
The upward trend will continue into 2001. The NAHB predicts that the market will finish out 2000 with expenditures of $144.5 billion. And in 2001, total remodeling expenditures will reach $150.5 billion.
"Most people think that the remodeling market is counter cyclical," Seiders said. He warned that the new home market, although it had a good start, is weakening. But instead of rising when new home construction slows, the remodeling market tends to loosely follow the new home market, he said.
Seiders also mentioned several factors that affect remodeling. Because of the appreciation of home prices, the profitability of a job might go up if homeowners view their remodel as an investment, he said. And declines in the price of materials will make them more available. Of course, the labor situation remains a concern for the industry, as well as competition from "Big Box" suppliers in both materials and remodeling work.
Jan Williams, CGR, chair of the NAHB Remodelors Council, noted optimistically that remodelers around the country are rushing to keep up with consumer demand. And as the housing stock continues to age and peopleÆs lifestyles and tastes continue to change, "WeÆre in business."