Overview March 2013

Kitchens & Baths

Top Industry Trends for 2013

Gray color schemes in both kitchens and baths have witnessed a dramatic escalation since 2010, particularly over the past year, according to the National Kitchen and Bath Association’s annual design trends survey. Used currently in 55% of kitchens and 56% of bathrooms, shades of gray are growing in appeal, creating chic, sophisticated spaces that many consumers desire.

 Continuing an important trend from last year, transitional-style kitchens and baths have clearly surpassed traditional styles, a longstanding favorite until 2012.

While the use of quartz finishes was in slight decline last year, it has surfaced as a clear trendsetter this year, coming a close second to perennial favorite granite.

Homeowners were spending more on their kitchen and bath remodels a year ago -- however, the latest report reveals a slightly less robust situation. The total cost of the average kitchen and of the average bath design in 2012 was $51,050 and $18,575, respectively, but the most recent figures have dipped to $47,308 in kitchens, while staying steady at $18,538 in bathrooms.

Although some trends from the past year continue to grow significantly into 2013, the last three months of 2012 have also laid the groundwork for new ones to thrive. Some of the other top trending design components include white painted cabinetry, glass backsplashes, LED lighting, touch-activated faucets and satin-nickel finishes in kitchens; and ceramic/porcelain tiles and undermount sinks in bathrooms.

 

Charts to go with Top Industry Trends for 2013 (above)

Grays in Kitchens

2010 – 9%

2011 – 17%

2012 – 33%

2013 – 55%

 

Grays in Bathrooms

2010 – 12%

2011 – 21%

2012 – 40%

2013 – 56%

 

Associations

Houston Contractor to Chair NAHB Remodelers

w/photo

Bill Shaw, GMR, GMB, CGP, owner of William Shaw & Associates in Houston, was appointed as the 2013 chairman of the National Association of Home Builders (NAHB) Remodelers in February at the International Builders’ Show in Las Vegas.

Shaw has been in the residential remodeling business for more than 25 years, following a career as an officer in the U.S. Navy. He is a past president and board member of the Greater Houston Builders Association Remodelers Council, as well as the past president of the Texas Association of Builders Remodelers Council. Currently, Shaw serves on the board of directors of NAHB and is chair of the NAHB Joint Councils Committee. He also teaches NAHB Education courses.

 

Home Prices

Biggest Increase Since 2006

CoreLogic’s December CoreLogic HPI report says home prices nationwide, including distressed sales, increased on a year-over-year basis by 8.3 percent in December 2012 compared to December 2011. This change represents the biggest increase since May 2006 and the 10th consecutive monthly increase in home prices nationally. The CoreLogic Pending HPI indicates that January 2013 home prices, including distressed sales, are expected to rise by 7.9 percent on a year-over-year basis from January 2012 and fall by 1 percent on a month-over-month basis from December 2012, reflecting a seasonal winter slowdown.

 

Home Improvement App

Zillow Reaches out to Remodeling Market

With Zillow Digs, homeowners can find and connect with local professionals such as architects, contractors and designers. Professionals can create a free Zillow Digs profile with contact information, photos of past work and a link to their websites. Professionals also can market their expertise and their business by creating Boards, commenting on others' photos and answering questions. In addition users can browse thousands of photos and see Zillow's Digs Estimates for the estimated cost, based on where they live, of the actual bathrooms and kitchens they are viewing. They can create, save and share Boards of ideas and decor, browse Boards created by others, comment on photos and follow people with similar interests.

 

Finances

Publication Offers Look into Finances of Remodelers

Remodelers have a unique opportunity to see how their business stacks up against the competition with a new publication from the National Association of Home Builders (NAHB). NAHB’s publishing arm, BuilderBooks, recently released the 2012 edition of the “Remodelers’ Cost of Doing Business Study: A National Study of Remodelers’ Business Practices and Financial Performance.” The study provides remodelers the opportunity to evaluate their financial performance compared with the industry as a whole and with remodelers of similar type and size. The publication is available only as an e-Book at ebooks.builderbooks.com.

 

Outdoor Living

Top Alfresco Living Trends for 2013

American homeowners increasingly are drawn to adding outdoor rooms for entertaining and recreation on their properties, according to the 2013 Residential Landscape Architecture Trends survey conducted by the American Society of Landscape Architects. The results also show demand for both sustainable and low-maintenance design. The category of outdoor living spaces, defined as kitchens and entertainment spaces, received a 94.5 percent rating as somewhat or very popular. It all but tied with gardens and landscaped spaces at 94.4 percent. Across all categories, 97 percent of respondents rated fire pits and fireplaces as somewhat or very in-demand for 2013, followed by grills (96.3 percent), seating and dining areas (96.3 percent), and lighting (95.1 percent).

 

New Homes

Housing Outlook Continues to Brighten

The housing upturn that took root last year is expected to pick up momentum in 2013 but headwinds along a number of fronts could impede the pace of the recovery, according to economists speaking at the International Builders' Show in Las Vegas. "Nearly every measure of housing market strength — sales, starts, prices, permits and builder confidence — has been trending upward in recent months and we expect to see gradual but steady growth along these lines in 2013," said NAHB Chief Economist David Crowe. In particular, Crowe said that house prices are up nearly 6 percent on an annualized rate over the past 10 months.

 

Home Sales

Pending Sales Remain on Uptrend

Pending home sales declined in December but have stayed above year-ago levels for 20 consecutive months, according to the National Association of Realtors. The Pending Home Sales Index, a forward-looking indicator based on contract signings, fell 4.3 percent to 101.7 in December from 106.3 in November but is 6.9 percent higher than December 2011 when it was 95.1. The data reflect contracts but not closings. Lawrence Yun , NAR chief economist, said there is an uneven uptrend. "The supply limitation appears to be the main factor holding back contract signings in the past month. Still, contract activity has risen for 20 straight months on a year-over-year basis," he said.

 

Improving Markets

List of Improving Housing Markets

The number of improving housing markets continued to expand for a sixth consecutive month to a total of 259 metropolitan areas on the National Association of Home Builders/First American Improving Markets Index (IMI) for February. This is up from 242 markets listed as improving in January, and includes entrants from all 50 states and the District of the Columbia.

 

Real Estate

Home Prices Show Strong Gains

A growing number of metropolitan areas had higher median home prices in the fourth quarter, with the national price showing the strongest year-over-year increase in seven years, according to the National Association of Realtors. The median existing single-family home price rose in 133 out of 152 metropolitan statistical areas (MSAs) based on closings in the fourth quarter compared with same quarter in 2011, while 19 areas had price declines.

 

Housing

Affordability Increases at Year-End 2012

Exceptionally low interest rates helped ensure a slight gain in nationwide housing affordability amid relatively stable house prices in the final quarter of 2012, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI). In all, 74.9 percent of homes sold between the beginning of October and end of December were affordable to families earning the U.S. median income of $65,000. This was up nearly a percentage point from the 74.1 percent of homes sold that were affordable to median-income earners in last year's third quarter.

 

Statistics – chart – bar or pie – stand-alone

 

2012 Remodeling Business Structures

 

S-Corp – 49%

Limited Liability Company (LLC) – 23%

C-Corp – 16%

Sole Proprietorship – 11%

Partnership – 1%

Don’t know – 1%

 

Source: National Association of the Remodeling Industry, 2012 Member Profile

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