Residential spending on kitchen and bath remodeling may never return to the heights of the pandemic spending frenzy but it is still topping the numbers from 2019.
Not surprisingly, homeowners aren’t spending as much on their kitchen and bath remodeling projects this year as they did in 2022 but new numbers from the National Kitchen & Bath Association say the business is still beating the pre-pandemic levels.
Even more encouraging is that the association says the long-term forecast “remains strong, primarily because of an additional 2.2 million homes entering their prime remodeling period in the next five years.” Other factors that indicate better business ahead are the high levels of equity homeowners have built up in the tight housing market and the fact that some remodeling projects are being deferred now due to economic conditions.
For 2023, spending is forecast to decline 5% to $179 billion from the all-time record high of last year. This breaks down to $111 billion going for new construction kitchen and bath spending and $68 billion for existing home repair and remodeling spending.
“The projected repair-and-remodeling decline is due in large part to high inflation, which continues to erode excess household savings, the primary driver of repair-and-remodeling spending during the pandemic,” the NKBA said. “Higher interest rates have also made it less appealing to tap into home equity. The one bright spot is that higher-income households are less rate-sensitive and continue investing in luxury kitchen and bath remodels.”
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