Kitchen & Bath Business Jan/Feb 2024 and KBIS Directory - 16

nkba note
January/February2024
2024 AND BEYOND
A
s we look ahead to 2024 and the back half
of the decade, there's some uncertainty,
but there's also a lot of opportunity.
Our 2024 forecast for remodel spending
is $67 billion, a modest 2% year-overyear
decline. For most homeowners with
outstanding mortgages below 5%, it is simply
more cost eff ective to remodel than to move.
Although these homeowners' appetite to remodel
is strong, many of these households are
deferring large projects or breaking them into
smaller phases because of a decline in excess
household savings, which have been eroded
by infl ation over the past 18 months; higher
fi nancing rates; and continued overall uncertainty
about the economy.
DIY spend is expected to grow by 2%, as many
of these consumers are expected to undertake
simpler patch-fi xes until they are ready to fund
larger remodels. High-income households seem
to be the exception, as many are expected to move
forward with their remodeling projects in 2024,
preferring to tap into savings rather than fi nancing
tied to prevailing high interest rates.
Th ere is a glimmer of light overall, however, as
the economy seems to be heading in the right direction.
Infl ation looks to be tracking downward,
and possible rate drops in the coming months
may bring home sales back to normal levels and
drive an increase in pent-up demand for kitchen
and bath remodels.
In fact, our recently released " 2024 Kitchen &
Bath Market Outlook " indicates that the kitchen
and bath industry is fundamentally strong with a
positive long-term outlook for remodels.
Th is is because of three key factors:
* Homeowners are still sitting on record levels
of home equity they can tap into once rates
stabilize, as projected.
* Remodeling projects deferred in early 2024
will fuel demand in the coming years.
* Th e number of homes in prime remodeling
16
/ JANUARY-FEBRUARY 2024
BILL DARCY
Global President & CEO
NKBA | KBIS
linkedin.com/in/billdarcyjr/
years will grow by 2.2 million by 2027, reaching a total of 24 million.
As our friend Todd Tomalak from Zonda said in his recent forecast for
2024: " Th e backdrop for remodel spending [from] 2025-2030 is excellent,
and kitchen and bath is poised to grow faster than the broader housing/
remodeling industry. "
Why? Because, as he noted, the housing confi guration has shifted in
the past 20 years, so there are 29% more baths today. Zonda's data suggests
the typical bath is remodeled at least once every 50 years, and kitchen and
bath remodel volume will need to grow by at least 21% from current levels
just to keep up.
So yes, we have some challenges in the near term of 2024, but overall we
are looking at a positive outlook in the coming years for the kitchen and
bath industry. And I, for one, will ensure that NKBA will be there to help
its members drive forward, remain strong and take advantage of what's
ahead - a bright future for all.
PHOTO CREDIT/ADBOE STOCK: BY PAKIN
http://www.linkedin.com/in/billdarcyjr/
Kitchen & Bath Business Jan/Feb 2024 and KBIS Directory

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