HACKETTSTOWN, NJ — The kitchen and bath industry is expected to post strong growth in 2021, although the pace of that growth is apparently cooling, according to the latest Market Forecast Report issued by the National Kitchen & Bath Association.

According to the second, and final, update to the NKBA’s 2021 Market Forecast Report, the industry is expected to register “healthy, double-digit gains over 2020,” although the latest forecast has been “pared back a bit” compared to the previous (July) forecast – due largely to ongoing supply-chain disruptions, labor shortages and higher material costs, the NKBA reported.

The NKBA’s final 2021 Market Outlook, released early this month, projects full-year revenues of $167 billion, a 19% increase over the $141 billion posted in 2020. The new forecast, however, represents a modest downtown from the July Market Outlook, which pegged year-end 2021 revenue totals at $171 billion.

“This year has been like none other for our industry, as strong growth across virtually every sector has led to record revenues,” said Bill Darcy, CEO of the Hackettstown, NJ-based NKBA.

However, “some homeowners, faced with price increases related to supply chain shortages, are deferring projects until they have enough saved to get exactly what they want, or in the hope that costs will come down,” Darcy added.

The NKBA’s latest forecast projects a nearly 10% year-over-year growth in the kitchen and bath remodeling sector, and a 26% growth in new construction. Premium projects are expected to be up by more than 22% – although down from the 28+% forecast in July – while low-end projects will grow under 11%, “suggesting a cooling of the DIY trend,” the NKBA said.

“These findings are very encouraging and indicate that not only will we close out this year on a solid note, but the growth should be sustained into 2022,” Darcy observed.

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CAMBRIDGE, MA “Strong growth” in home improvement and maintenance expenditures is expected to continue over the coming year, according to the Leading Indicator of Remodeling Activity (LIRA) by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University.

The LIRA projects year-over-year gains in annual improvement and repair spending will reach 9% in the fourth quarter of this year and maintain that pace into 2022.

“Residential remodeling continues to benefit from a strong housing market with elevated home construction and sales activity and immense house price appreciation in markets across the country,” said Carlos Martín, project director of the Remodeling Futures Program at the Cambridge, MA-based Joint Center. “The rapid expansion of owners’ equity is likely to fuel demand for more and larger remodeling projects into next year.”

“With these tailwinds, annual improvement and repair expenditures by homeowners could reach $400 billion by the third quarter of 2022,” added Abbe Will, associate project director of the Remodeling Futures Program. Will warned, however, that “several headwinds,” including the rising costs of labor and building materials, as well as increasing interest rates, “could still taper the expected growth in remodeling spending.”

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WASHINGTON, DC Strong consumer demand helped push builder confidence higher in October despite growing affordability challenges stemming from rising material prices and shortages, the National Association of Home Builders reported.

According to the Washington, DC-based NAHB, builder sentiment in the market for newly built single-family homes moved four points higher to 80 in October, according to the latest monthly NAHB/Wells Fargo Housing Market Index (HMI), released this week.

The NAHB also reported that single-family housing production held steady in September, at a seasonally adjusted annual rate of 1.56 million units, as strong demand helped to offset ongoing building material supply chain disruptions.

“Although demand and home sales remain strong, builders continue to grapple with ongoing supply chain disruptions and labor shortages that are delaying completion times and putting upward pressure on building material and home prices,” said NAHB Chairman Chuck Fowke.

“Builders are getting increasingly concerned about affordability hurdles ahead for most buyers,” added NAHB Chief Economist Robert Dietz. “Building material price increases and bottlenecks persist, and interest rates are expected to rise in coming months as the Fed begins to taper its purchase of U.S. Treasuries and mortgage-backed debt.

“Policymakers must focus on fixing the broken supply chain,” Dietz observed. “This will spur more construction and help ease upward pressure on home prices.”

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