Houzz Stat: Where does your market stack up?
“Backlog” refers to the delay or wait time an average firm faces before starting a new midsize project due to its current project commitments.
Wait times to hire a professional vary greatly by location. Right now general contractors and remodelers and design-build firms are most backed up in the Boston metro area, at 13.9 weeks, with greater Seattle and Portland, Oregon, not far behind. Wait times for these renovation professionals are shortest in the Houston area, averaging 2.9 weeks. (Note: research predates Hurricane Harvey devastation in Houston.)
Firms in the West have the longest backlog, according to the Houzz Renovation Barometer Backlog Index. Design-build companies in the western United States report the biggest backlog among all the industry groups in the nation, an average of 8.3 weeks.
Existing home sales slip
Existing home sales declined in August, falling 1.7% to a seasonally adjusted annual rate of 5.35 million. That’s down from 5.44 million in July, according to data released Wednesday by the National Association of Realtors.
The median existing single-family home price was $255,500 in August, up 5.6% from August 2016.
"Steady employment gains, slowly rising incomes and lower mortgage rates generated sustained buyer interest all summer long, but unfortunately, not more home sales," said Lawrence Yun, NAR chief economist. "What's ailing the housing market and continues to weigh on overall sales is the inadequate levels of available inventory and the upward pressure it's putting on prices in several parts of the country. Sales have been unable to break out because there are simply not enough homes for sale."
For the full NAR release, click here.
Yun said sales in the south were curtailed by the damage of Hurricane Harvey. “Sales will be impacted the rest of the year in Houston, as well as in the most severely affected areas in Florida from Hurricane Irma,” Yun said. “However, nearly all of the lost activity will likely show up in 2018.”
Open season for outdoor products
Last spring, Heather Sanchez of Branchburg, N.J., didn’t wait for the summer to enjoy her deck. She purchased a deep seating outdoor furniture set from Lowe’s, an outdoor rug from Target and a solar-powered outdoor lamp from Home Depot.
“I was able to use my deck from March through September,” she said.
Sanchez is not alone.
A survey of landscapers, retailers and suppliers reveals that sales of products intended to bring indoor comforts outside are climbing, in some cases double digits. Top of the list: outdoor kitchens, pergolas or screen enclosures, masonry fireplaces, fire pits and beverage centers. But also emerging are everything from outdoor pizza ovens to entertainment centers with televisions.
Simply put: The garden gnome isn’t enough anymore.
“People, especially as we see warmer weather sticking around, want to prolong their investment in outdoors,” said Chris Demato, owner of Rock Bottom Landscaping & Fencing in Belle Mead, N.J.
There’s an ample market for products to adorn patios and porches. According to the Census Bureau, nearly all homes built in 2015 had a porch, deck or patio (or a combination). Sprucing up the backyard can payoff, according to Laura Pally, a real estate agent based in Somerset County, N.J. “People want to see nice backyards with built-in fireplaces and kitchens. It can add as much as 10% or more to the sale price.”
Returns on investment of patios and decks average at least 60%, she noted.
The boom in more sophisticated outdoor accouterments is welcome news to an industry that is still hard-pressed to recover from the recession, as well as mired in mounting competition from online retailers, according to Mitch Arons, an associate at Patio World Home & Hearth, which operates stores in New Jersey and Florida. People looking to update existing furniture are a welcome sight, especially since consumers are willing to pay a premium for pieces that mimic living rooms.
Outdoor kitchens, Demato added, are one of the fastest-growing segments, and that’s sparked sales of grills, especially models that slide into masonry (along with refrigerators and sinks). That’s good news for the grill business, which has a high saturation point — thus requiring reasons to buy new. Craig Hansen, senior merchant for barbecue at Ace Hardware, noted that 75% of American households already own a grill. Too often they only buy when their existing one breaks — or in this case, they want to upgrade.
At the Montgomery True Value in Skillman, N.J., store associates noted that many shoppers mimic the outdoor kitchen concept with larger, high-performance grills. Weber’s side burners were cited as an example.
It isn’t only gas grills getting the nod. At Ace Hardware in Princeton, N.J., store manager Tim Demarest said he has a large customer base for ceramic kamado-style charcoal grills.
Extending the outdoor cooking boundaries are boosting sales at the Pit Barrel Cooker Co., according to company founder Noah Glanville. He added that his hook-and-hang method is suitable for those tight on space.
“The footprint is efficient, you don’t need to plug it in. And even people who have never cooked before get great tasting meat every time,” Glanville said, also noting Pit Barrel Cooker is introducing a smaller Pit Barrel Junior this year.
Building upon the concept of outdoor living rooms, Thomas Flint, owner of Thomas Flint Landscape Design & Development in Midland Park, N.J., said he’s seeing more demand for patio and living spaces with separate areas. He likens it to indoors, where people like to transition from dining areas to lounge areas. And it isn’t just for those with mammoth space.
“Not all of the spectacular landscapes are built in huge backyards. Oftentimes, smaller backyards are more intimate and create beautiful outdoor living spaces,” Flint added. That trend also translates into bigger tickets, the experts said, as consumers snap up furniture for multiple living spaces.
Retailers, including those surveyed at Lowe’s and True Value, also pointed to the use of paint on concrete to lend a pop of color and create different “rooms.” Paint can be used to duplicate the look of tile or even a striped rug. Outdoor rugs, such as those from Couristan, were also noted as popular choices for patio upgrades.
Whether fueled by fears of mosquito-transmitted disease or the ongoing desire to extend seasons, Cynthia Ferranto, owner of the eponymously named landscaping design company, noted escalating requests for screened enclosures.
Bill Lecorchick Jr. at Legends Home Improvement agreed, adding he is suggesting more roofs over outdoor spaces that then can be equipped with ceiling fans, conversation pits and televisions. “Adding a roof adds value to any outdoor area,” he said.
And as with so many product categories, Millennials are making their mark in lawn and garden. Resonating with environmentally aware shoppers at Patio World, according to Arons, are American-made recycled outdoor dining tables made from recycled milk jugs and detergent bottles featured at his store. In addition to being extremely durable, the pieces are environmentally friendly.
Fire pits continue to blaze sales, especially new models with glass in the pit. Although Demato is building more fireplaces, he also recommends pits for those who might want to take to move the fire pit.
“There are some really nice versions at Home Depot and other retailers,” he concluded.