Kitchen & Bath

Kitchen and Bath business projected to contract but still projected to be 16 percent higher than 2021 The National Kitchen & Bath Association (NKBA)– the world’s leading association for the kitchen and bath industry has released its midyear 2022 Kitchen & Bath Market Outlook. While both inflation and mortgage rate increases have impacted the segment, the overall Read more

Kitchen and Bath business projected to contract but still projected to be 16 percent higher than 2021

The National Kitchen & Bath Association (NKBA)– the world’s leading association for the kitchen and bath industry has released its midyear 2022 Kitchen & Bath Market Outlook. While both inflation and mortgage rate increases have impacted the segment, the overall annual forecast still represents a double-digit increase over 2021.

“This new Market Outlook report provides revised market size estimates and 2022 forecasts in the Kitchen and Bath Industry, as well as gauges the economic and housing market shifts that continue to impact our market,” said Bill Darcy, CEO of the National Kitchen & Bath Association (NKBA). “Despite some economic headwinds, kitchen and bath remodeling demand remains strong. Residential kitchen and bath spending is anticipated to grow by 16% to $189 billion in 2022.”

NKBA’s 2022 Kitchen and Bath Market Outlook Midyear Report Top Takeaway

  • Resilient Revenues. Full-year kitchen and bath spending is expected to reach $189 billion, 16 percent higher than 2021, yet $10 billion lower than the initial 2022 forecast.
  • New Construction Strength. New construction is projected to represent over 60 percent of industry revenues, driven by a record number of new home builds.  The report forecasts 21 percent YOY new construction growth, unchanged from the initial report in January.
  • Larger Projects Gaining Momentum. Higher-end activity has been revised upward due to rapid home appreciation and client movement on deferred projects.  With upwards of 20 percent gains, mid-range projects are expected to register the biggest YOY increases based on growth in new construction.  Lower-end work projection has been sharply scaled back due to higher inflation causing many to put their projects on hold.
  • Numerous Remodel Drivers. Nearly three in four homeowners are locked into mortgage rates below 4 percent, making it more cost-effective to remodel than to move. This, along with record-high homeowner equity per household and a high number of homes in prime remodeling years, bodes well for the second half of 2022.
  • Normalization of Housing Starts/Completions. While builders are working through the substantial backlog of homes in various stages of completion, the number of new housing starts are falling due to high mortgage rates and home prices. This combination has led to a shrinking gap between home starts and completions.
  • Recession Concerns. The Fed has tried to control inflation with three interest rate hikes this year, the latest in June. Of note: The last three times the Fed initiated a cycle of rate hikes, a recession ensued within a year.

“We anticipate moderate declines in kitchen and bath spending in the event of a recession next year,” said Darcy. “Our view is informed by improved housing and consumer fundamentals and a likely less severe recession, relative to recent history if one were to occur.”

To learn more about the key findings and to access the full 2022 Kitchen & Bath Market Outlook: July Update, contact Brittany Loeffler at bloeffler@whitegood.com.

Projects Shift Upward in Price Sales growth expectations rise to 13.4% The National Kitchen & Bath Association (NKBA) and John Burns Real Estate Consulting (JBREC) today reported that their Q1 2021 Kitchen & Bath Market Index (KBMI) has soared to a rating 79.8, its highest score since the inception of the index. KBMI measures the Read more

Projects Shift Upward in Price Sales growth expectations rise to 13.4%

The National Kitchen & Bath Association (NKBA) and John Burns Real Estate Consulting (JBREC) today reported that their Q1 2021 Kitchen & Bath Market Index (KBMI) has soared to a rating 79.8, its highest score since the inception of the index.

KBMI measures the current strength of the industry, expectations and challenges facing four major sectors — design, manufacturing, retail and building — with scores above 50 indicating expansion and scores below 50, contraction. The current rating marks an increase of 14.8 points from last quarter alone and a 38.8 point improvement from this time last year.

Significantly, one in three designers noted that clients are now requesting higher-priced products and finishes. Retailers are experiencing that same customer shift. The trend is likely owing to quick-fix, pandemic-driven DIY projects running their course and being replaced by serious makeovers to accommodate new lifestyles.

“There is continued optimism in the industry with COVID-19 becoming less of an obstacle due to the rapid vaccine rollout,” said NKBA CEO Bill Darcy. “We are encouraged to see the index reach a historic high, and look forward to the continued industry growth as homeowners opt for larger, more upscale remodels.”

“As consumers experience more flexibility in their working arrangements, there’s an increased need for total reconfigurations for their spaces,” notes Todd Tomalak, Principal of JBREC. “And from an economic perspective, we’ve seen Americans utilizing their stimulus checks and savings from canceled vacations or other activations — which have been largely paused for the last year —  for these home-improvement projects.” 

Overall, demand is at an all-time high as vaccination rates increase and for some, permanent and hybrid work-from-home lifestyles are encouraging consumers to reconfigure their home layouts. As the pandemic’s impact on the market starts to lessen and previously postponed projects resume, backlogs for projects are reaching upwards of three to six months. Continued supply chain disruptions from COVID-fueled demand and factory shutdowns at the onset of the pandemic are further affected by the Suez Canal incident and overall port congestion, but NKBA members remain confident in the industry outlook with expected sales to be markedly higher in Q2 2021.

As members see less of a negative impact from COVID-19 on their business, they reported a near-double-digit sales growth of 9.7% on average in Q1 2021, compared to the same period in 2020.

As for future sales and overall industry health, bullish demand and consumer confidence continue to fuel a positive outlook. Design companies have the lowest rating of the overall industry, at 76.1, while Building & Construction, Retail Sales and Manufacturing segments soar at 83.8, 82.2, and 86.7, respectively.

And overall, the industry increased full-year sales growth expectations to 13.4% in 2021, up from their rating of 10.7% in Q4 2020.

The following trends are expected to impact homeowners and the industry through 2021:

  • Members are seeing larger project scopes as homeowners invest in whole-home reconfigurations and luxury finishes.
    • Designers also cite permanent work-from-home lifestyles as a catalyst for the consumer shift to high-end, higher-priced materials and finishes with designer firms reporting a 61% increase in the average size of projects.
  • The main obstacle for members is sourcing affordable materials as delays and price hikes make it difficult to maintain profit margins. More US-based sourcing could be likely as import delays and pricing become more severe and firms are sourcing outside their approved vendor list to accommodate.
    • Appliances have been the most difficult products to source, with 51% of designers reporting difficulty sourcing refrigerators, ranges/stoves and dishwashers.
  • The majority of firms are increasing labor rates to maintain current staffing levels and bolster recruitment efforts, but these increased costs aren’t expected to deter demand, as consumers are eager to remodel their primary bath and kitchen spaces.

Notable challenges and opportunities for the kitchen and bath market include:

  • Over half of designers (55%) report no project cancellations or postponements in Q1, but 45% note material shortage and product pricing are starting to affect project timelines.
  • As vaccination rates climb, consumers are more comfortable shopping in-person for items with over 50% of retailers reporting growth in foot traffic in Q1 2021 (compared to 35% in Q4 2020).
  •  45% of retailers continue to report a shift in price-point with 70% shifting to higher prices, and despite price surges for some products, consumers are still opting to pay for high-end products and finishes. Refrigerators and ranges/stoves are seeing the highest price climb at 12% and 11%, respectively.
  •  60% of manufacturing firms report average lead times of 6+ weeks in Q1 2021, a drastic increase from Q4 2020 (36% reporting 6+ week lead times). 78% of manufacturers report severe capacity constraints at this time, a rise from the prior quarter (23%) due to extended lead times on raw materials and significant freight delays.
  • With the surge in remodeling demand, 67% of building and construction firms report a backlog of 3+ months and of that, 21% have a backlog extending through 2021.
  • With the pandemic affecting many industry professionals, the already strained labor market continued to dwindle. In response, over 60% of companies report increasing labor rates to retain current staff and of the companies reporting labor rate increases, almost half report increasing labor rates 10-19%.

When it comes to style trends and technology, kitchen and bath products have kept up in today’s marketplace. In terms of finishes, designers and homeowners alike are looking for statement pieces that will stand out in a space and get noticed. “With a wider array of finishes becoming more popular in the marketplace, and the Read more

Matching Style Trends and Technology with Moen Products, Brushed Gold, U by Moen, Flo by Moen, kitchen & bath trendsWhen it comes to style trends and technology, kitchen and bath products have kept up in today’s marketplace. In terms of finishes, designers and homeowners alike are looking for statement pieces that will stand out in a space and get noticed. “With a wider array of finishes becoming more popular in the marketplace, and the rising trend of combining different finishes and textures, Moen, for example, has thoughtfully crafted a sophisticated Brushed Gold finish,” says Danielle Radic, product manager, Moen.

Historically, gold fixtures were often associated with traditional design, but now, homeowners are also using this finish as part of a modern aesthetic, says Radic. Moen’s Brushed Gold finish, available on select kitchen and bathroom faucets, allows consumers to add elegance to their space and blends seamlessly with a variety of décor styles. “It also mixes well with other gold accents they may have throughout their space and has been designed to stand the test of time,” says Radic.

Matching Style Trends and Technology with Moen Products, Brushed Gold, U by Moen, Flo by Moen, kitchen & bath trendsAdditionally, homeowners continue to incorporate dark finishes into their homes. Moen’s on-trend Matte Black finish, available on a selection of kitchen and bath fixtures, offers a contemporary look that complements a variety of décor choices, while providing consumers with a unique finish that makes a statement.

Matching Style Trends and Technology with Moen Products, Brushed Gold, U by Moen, Flo by Moen, kitchen & bath trends

In regards to technology, consumers also are continuing to gravitate towards innovations that make their lives easier, including products that offer the benefit of smart technology. “In 2019, we’re showcasing some updates to the U by Moen shower, which is a cloud-based, app-driven digital shower that offers Wi-Fi mobile connectivity and unmatched personalization, delivering on consumers’ desire to create their perfect shower experience with up to 12 customizable presets,” says Michael Poloha, group manager, IoT, Moen. Consumers can control their shower anyway they like: with their voice, the smartphone app or the in-shower controller.

Matching Style Trends and Technology with Moen Products, Brushed Gold, U by Moen, Flo by Moen, kitchen & bath trendsThe product now features enhanced functionality with Amazon Alexa—including compatibility with groups and routines—as well as compatibility with Apple HomeKit and Google Assistant. There’s also a new Matte Black controller finish for additional design customization.

“We’re also excited to introduce Flo by Moen, a game-changing smart home water monitoring and leak detection system that enables homeowners to control their home’s water from their smartphones,” says Poloha. It calculates water pressure, flow rate and temperature within the home’s water supply system while using AI to differentiate normal water use from abnormal use. This enables the device to monitor and help detect water leaks and other vulnerabilities, says Poloha.

Matching Style Trends and Technology with Moen Products, Brushed Gold, U by Moen, Flo by Moen, kitchen & bath trends

The Flo by Moen app provides users with real-time information about their home’s water consumption habits and alerts to any abnormalities. Within the app, users can control how the system provides alerts and respond to potential issues. Alerts may be sent to users through push notifications, via email, or by text or phone call. The user also can turn off their water directly from the app.

 

BLANCO, the German manufacturer of finely crafted sinks and faucets, introduces the SOLENTA® and SOLENTA® Senso professional faucets. Inspired by professional kitchens, the impeccably crafted SOLENTA Senso features convenient, sensor technology for the ultimate hands free faucet experience. Sensor technology redefined, the BLANCO SOLENTA takes luxury to a higher level featuring sleek design details, a Read more

BLANCO, the German manufacturer of finely crafted sinks and faucets, introduces the SOLENTA® and SOLENTA® Senso professional faucets. Inspired by professional kitchens, the impeccably crafted SOLENTA Senso features convenient, sensor technology for the ultimate hands free faucet experience.

Sensor technology redefined, the BLANCO SOLENTA takes luxury to a higher level featuring sleek design details, a powerful dual spray and an easy to clean closed coil. Available in sensor or non-sensor models, the SOLENTA faucet is crafted of high-quality, long lasting materials.

“The new SOLENTA SENSO faucet takes sensor technology a step further with the ability to control the flow of water without touching the faucet – simply by waving it on or off,” states Tim Maicher, Director of Marketing for BLANCO. “In addition to being innovative and forward thinking, the SOLENTA embodies beautiful design, drawing inspiration from the chef-inspired look of professional faucets. With BLANCO SOLENTA designers have it all ­­– a trending look with innovative hands free convenience, performance and easy care features.”

The BLANCO SOLENTA and SOLENTA Senso Semi-Professional faucets feature a quick release magnetic hand spray and a flexible steel closed coil spout for easy usage and cleanability. Offered in Stainless Finish and Polished Chrome.

For more information, visit www.blancoamerica.com.

Sugar Hill, Ga.—MTI Baths celebrates its 30th anniversary this month, a milestone that highlights the transformation of a small family business into one of today’s leading bath manufacturers. It all started with one man’s dream to create a better bathtub and today the company celebrates their founder who’s spirit of risk-taking was inspirational and integral Read more

Sugar Hill, Ga.—MTI Baths celebrates its 30th anniversary this month, a milestone that highlights the transformation of a small family business into one of today’s leading bath manufacturers. It all started with one man’s dream to create a better bathtub and today the company celebrates their founder who’s spirit of risk-taking was inspirational and integral to MTI’s culture. From its humble beginnings to its current position as a leading bath manufacturer, MTI Baths has had an unerring focus on excellence that has influenced everything they do – from design innovation to craftsmanship to customer service.

MTI offers an extensive product line with hundreds of tubs in every shape and style as well as shower bases, sinks, counter-sinks, vanity sinks and genuine teak accessories. The company has earned well over 100 awards for new products, design excellence and product innovations, in addition to being featured countless times on popular TV programs like HGTV, Property Brothers and DiY.

“We are fortunate to have a dedicated staff who make it possible for MTI to provide our clients with excellent craftsmanship and service,” said CEO Kathy Adams. The company has been recognized as a Top Workplace by the Atlanta Constitution-Journal for creating a work environment that encourages employee feedback and fosters growth by taking ideas from every department, not just upper management.

As they embark on this milestone anniversary, the brand continues its dedication to “the 3 R’s of MTI” – respect, responsibility and resourcefulness and a corporate culture that rewards creativity, flexibility and passion. Company CEO Kathy Adams explains the company strategy this way “We don’t want to be just best in the world at one thing – we want to try to be best in the world at every single thing we do. When you make that your goal, continual improvement happens.”

“We thank our customers, showrooms and dealers, vendors, partners and especially our nearly 115 employee owners for 30 amazing years!” says Russell Adams, President and Chief Design Officer.