Industry Sales Projection Revised Sharply Upward by NKBA
HACKETTSTOWN, NJ — The National Kitchen & Bath Association has revised its 2021 industry sales projection to $170.9 billion, up by a substantial 21.4% from last year’s $140.8 billion in kitchen and bath spending, and nearly 8% higher than the association’s initial estimate for the year.
The revised estimate, announced in early July, pegs kitchen and bath spending for new construction this year to exceed 2020 by 28.5%, as builders attempt to keep pace with substantial demand. Kitchen and bath remodeling spending is expected to climb by 12.5%, according to the NKBA, which said it based its projections on a review of current industry conditions as well as macroeconomic factors that are likely to impact business.
“This update is very encouraging and confirms the ongoing robust performance of the design and remodeling industry,” said Bill Darcy, CEO of the Hackettstown, NJ-based NKBA. “This very strong sales forecast is attributable to pent-up demand for new home construction, easing COVID disruptions and a sea change in consumer behavior.
“People will continue to work from home in some capacity, fostering renovation of their space to meet their evolving needs. A tight inventory of homes for sale is also encouraging homeowners to stay put and renovate. That’s good news for our industry.”
Darcy cautioned, however, that there are “a few bumps in the road.” For example, he said, home prices continue to rise, and the cost of building materials is still high, a combination that’s excluding some potential buyers from the market; the employment picture still hasn’t fully recovered to pre-pandemic peaks, and supply-chain disruptions continue to delay jobs and make product sourcing a challenge.
“But most indicators suggest the thriving kitchen and bath market will continue,” he added.
Among the report’s other key findings:
n The industry should see double-digit increases in both kitchen and bath spending. This is a reversal from the industry’s 3.8% decline in 2020, which was driven by an 8.6% loss for remodeling and stagnant growth of just 0.5% for new construction during the pandemic. Bathroom spending will rise by 22.3% in 2021 and will be sparked mainly by gains in new construction, while kitchen spending will increase by 20.4%, led by stronger gains in remodeling.
n Although forecasts for low and mid-range project spending have each been revised upward, “it’s the high-end that will shine,” according to the NKBA, which said that big-ticket projects are expected to surge by more than 28% compared to 2020 (beating the initial 19.8% projection) “as pent-up demand, robust savings and impressive house appreciation encourage homeowners to go the extra mile.”
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