Year-over-year growth in remodeling and repair spending is expected to shrink from 16.1% in 2022 to 6.5% by the third quarter of 2023, according to the Leading Indicator of Remodeling Activity (LIRA) by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University.
“Housing and remodeling markets are undoubtedly slowing from the exceptionally high and unsustainable growth rates that followed in the wake of the pandemic-induced recession,” said Carlos Martín, project director of the Remodeling Futures Program at the Center. “Spending for home improvements will continue to face headwinds from declining home sales, rising interest rates, and the increasing costs of contractor labor and building materials.”
“Although remodeling market gains are expected to cool significantly next year, homeowners still have record levels of home equity to support financing of renovations,” added Abbe Will, associate project director of the Remodeling Futures Program. “Energy-efficiency retrofits incentivized by the Inflation Reduction Act of 2022, as well as disaster repairs and mitigation projects following Hurricane Ian will further support expansion of the home remodeling market to almost $450 billion in 2023.”
With that in mind, most respondents (87.8%) to this year’s State of the Industry survey by Closets & Organized Storage magazine are optimistic and project 2023 business to be as good or better than 2022, including 45.9% citing better and 12.2% much better.
• Laminate/melamine is the most used material for closets, cited by 75% of respondents, followed by solid wood/veneer (16%). The remaining 9% was split between wire (5%) and specialty finishes (mirrors, leather, glass, metal, etc.), according to the Closets & Organized Storage 2022 State of the Industry survey.
• The North American garage furniture market size – $708.9 million in 2021 – is projected to reach $816.3 million by 2027, exhibiting a CAGR of 2.4% (2022-2027), according to Astute Analytica.
• 67% of new homes completed in 2021 included two-car garages, according to NAHB analysis of 2021 Census Bureau Survey of Construction data. The option for three or more car garages was most popular in the West North Central division with 47% of completed homes opting for this parking option. The Pacific division had the highest share of 2-car garages with 77%. One-car garages were most popular in the Middle Atlantic division (29%), while “other” which includes carport, off-street parking, and other parking facilities was the largest share in New England (13%).
• Which projects showed the most growth since 2021? According to the Closets & Organized Storage 2022 State of the Industry survey, they are: primary bedroom closets (83%), garages (45%), pantries (38%), home offices (32%) and laundry rooms (18%).
• Walk-in (76%), built-in (66%) and butler’s (62%) pantries will be the most requested styles over the next three years, according to respondents of the NKBA/KBIS 2023 Design Trends study. Also receiving votes were: wall pantry (40%), full-working pantry (32%), open-shelf pantry (30%), pullout pantry (21%) and standalone/freestanding pantry (12%).
Market Data Sources: Closets & Organized Storage magazine, Association of Closet and Storage Professionals, Houzz, National Association of Home Builders, LIRA/Joint Center for Housing Studies of Harvard University, Astute Analytica, National Kitchen & Bath Association, The Freedonia Group. Category: Closets & home organization includes: walk-in and reach-in closets, garages, mudrooms, pantries, laundry rooms and related products.
More data on North American woodworking and the specific wood product market segments can be found in the December 2022 FDMC Wood Industry Almanac. Also, find market data year-round at WoodworkingNetwork.com/news/almanac-market-data.
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