2020 Remodeling Industry Forecasts Leave Property Renovation Franchise Owners Excited
Today’s post digs into several remodeling industry forecasts to help prospective investors understand the value of property renovation franchise opportunities in 2020.
‘Below Average’ Remodeling Growth Headlines Mislead Investors
While it’s true that remodeling growth rates are dipping slightly in 2020, the “drop” is seriously overstated.
“Cooling house price gains, home sales activity, and remodeling permitting are lowering our expectations for home improvement and repair spending this year and next,” wrote Chris Herbert in a report for the Joint Center for Housing Studies of Harvard University. It was a pretty innocuous headline, but it nonetheless sent certain industry blogs spiraling, turning a reasonable LIRA forecast into sheer doom and gloom.
The truth is that we’re going to see a drop in growth from 7% to 2.6%. And here’s the kicker: the remodeling industry is still growing at a very healthy rate. After cruising on an extended period of above-trend growth, thanks to “weak homebuilding, aging homes, and other factors,” it’s only natural that we come down a little.
Moreover, Herbert never ruled out the possibility of another growth spike. “More favorable mortgage rates could still give a boost to home sales and refinancing this spring and summer,” he writes. But whether or not we see these spikes in remodeling activity, this industry forecast still gets property renovation franchise owners excited!
Compass Reads Favorably For Property Renovation Franchise Owners
“The United States construction industry continues to demonstrate positive improvement and momentum into the third quarter of 2019,” wrote Todd Feuerman in an article for The Contractor’s Compass, the official educational journal of the American Subcontractors Association.
Citing research by the Engineering News Record Magazine, Feuerman highlighted a strong 2.1% growth rate over the past year. And while certain sectors of the construction and development market have been “lumpy” and unpredictable, the demand for home remodeling has been growing steady. Survey results from the Engineering News Record Magazine’s top-400 contractors found that most believed these trends would persist through 2020.
Remodeling Industry Players Anticipate Big 2020
If you’ve kept an ear to the ground in any remodeling sectors, you might have picked up on business owners buzzing about a big 2020 on the horizon. More than half of all the residential renovation and design companies involved in a new Houzz survey believe that 2020 will be a “good or very good year” (65% to 82%), reflecting an uptick in expectations from 2019.
Anticipating a big year, Houzz found that more than a third of general contracting, design-build and building and renovation specialty companies (35% to 38%) and a fifth of architectural and interior design companies (20% of each) expect to hire in 2020.
Though the idea of the competition buffing up their employee roster might seem daunting, it’s really a good thing. If market conditions are good enough to justify other companies hiring new workers, they’re likely good enough to sustain your property renovation franchise.
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