The NKBA Futurist Summit shed light on the evolving housing market, home ownership in transition and how it impacts the kitchen and bath industry.
By Dianne M. Pogoda
Rising interest rates, rampant inflation, superheated demand for housing, tight inventories of homes for sale and the relatively new Build-To-Rent (BTR) market are all among the factors creating volatile economic conditions — and they’re all closely tied to the health of kitchen and bath construction and remodeling. It can be intimidating to understand, but at the first NKBA Futurist Summit, experts explained how these factors affect K&B.
Bill Darcy, NKBA CEO, and Randy Warner, VP of Sales at LG Builder and Signature Kitchen Suite and Vice Chair of the NKBA Board of Directors, summarized the virtual conference, which explored “Home Ownership: The Evolution of the American Dream,” noting that K&B demand is still strong despite dramatic fluctuations, simply because there is still a housing crunch.
Watch The Futurist Summit On Demand. Watch Now.
The summit was presented in partnership with housing market research firm Zonda and sponsored by Signature Kitchen Suite. Zonda economists and market analysts put the housing and real estate markets into perspective.
“Over the past two years, growth and demand outpaced production for many manufacturers,” Darcy began. “How do the slowdown in housing and higher interest rates impact K&B manufacturers?”
Warner observed that the last two years have seen robust growth, particularly on the appliance side, in both new construction and remodeling, but that is shifting somewhat. “It seems like there’s more remodeling going on now than new construction. If someone isn’t ready to move right now, they’re sitting at home and looking to remodel. But there’s still high demand for housing now — there’s a huge housing shortage. Build-to-rent is a new piece of the business and a tremendous opportunity for all of us.”
Darcy asked Warner about how NKBA members might manage the shift toward remodeling from new construction.
“Speaking about our business, the builder and luxury (SKS) segments are fairly new for LG Electronics, so even with a downturn, we expect to continue to experience tremendous growth,” Warner noted. “But for someone on the retail or remodeling side, the mix might trend downward a bit from luxury to a more core product. My advice for kitchen and bath designers and remodelers out there is to maintain strong partnerships with your vendor community. They can make or break you, in good times, when you need product, or in bad times, when there’s a warehouse full of product. Your vendors should be your partners, especially in these next few years.”
Darcy concurred that the business has been very strong in the past few years, and expects that strength to continue, based on the aging housing stock in the U.S., good fundamentals and unrelenting demand for housing.
Looking ahead, Warner concluded that there’s still a lot of innovation on the horizon that will help drive demand, whether it’s for new construction or the remodel/replacement market. “Product is always king, and if you’re innovating and delivering new product and healthier ways to prepare food at home, it will only help drive demand. No matter what the economy is, there will always be a need for a replacement product, or a need to update. Those who are innovating will win that business.”
As a sponsor of the Futurist Summit, SKS is offering cash rewards to designers for specifying Signature Kitchen Suite products in their kitchen designs; learn more about the SKS Partner Program here. The NKBA Futurist Summit is available to watch on-demand here.
