Big-box home improvement stores have long been blamed for the demise of the local hardware store. New research shows that these giant stores are also posing a threat to independent building supply retailers. To maintain market share, these retailers may want to roll out new ad campaigns emphasizing the features construction professionals are looking for.
Until recently, growth in the U.S. housing market had been fueled by the rising demand for single-family homes. Realtors established their businesses by promoting homes that were for sale. Some analyst believe a housing recovery has begun but they predict that type of demand in the industry, and the related advertising, will differ from what we’ve been accustomed to seeing.
Homeowners across the U.S. seem to be reaching the same conclusion. It might be a long time before the real estate market improves. As a result, they are now spending more money improving homes than at any time since 2004.
It’s not that consumers have closed the door on home improvement projects this year. But they have changed what they plan to spend money on. In large part, the spending is related to what they see as a depressed real estate market. Based on the latest findings from the American Express Spending & Saving Tracker, marketers of home improvement project materials can prepare campaigns to sell products that will be in demand this year.
Before the real estate crash, homeowners were busily remodeling and flipping houses, confident that even the most lavish improvement would provide a return on investment. But since the start of the recession, the rate of remodeling has slowed significantly. These days, consumers are cautiously approaching improvements to their homes. And they are playing close attention to which of these improvements will pay off as home prices are still dropping in many markets.
The home improvement market is showing promising signs of life. The latest American Express Spending & Saving Tracker survey indicates that homeowners plan to tackle projects ranging from new flooring to redoing a room this year. But don’t expect consumers to spend like they did previously. Instead, “consumers are following through on their previously stated intentions to exercise more financial discipline in 2010 as it relates to home improvement.”
Despite the slow and uneven recovery in the housing market, builders still support green building strategies. This support continues even though green practices add costs to a project’s price tag. However, the Fourth Annual Green Building Survey by Allen Matkins, Constructive Technologies Group (CTG) and the Green Building Inside finds that while 92.3% of builders are devoting resources to green projects in 2010, only 61.7% seek Leadership in Energy and Environmental Design [LEED] certification.