The National Kitchen and Bath Association (NKBA) is the leader in industry news, education, and trend predictions. Hence, it was not surprising that when the association predicted a slight kitchen and bath revenue decline in 2023, the numbers panned out and indeed supported the claim.
Alternatively, in an interview with Designers Today, NKBA CEO Bill Darcy Jr. shared some optimistic insights for 2024. Darcy cited five key drivers that will impact homeowners’ decisions to either move or, more likely, remodel their homes this year, and all signs point to incredible opportunities for premium and luxury appliance dealers to flourish. Here’s what you need to know.
Remodeling Insights
There are currently more than 40 million homeowners who have interest rates below 5%. With today’s interest rates between 6.5% (15-year fixed) and 7.5% (30-year fixed), it’s hard to justify moving. Additionally, home equity and home price appreciation are at all-time highs, which makes staying put that much more appealing.
Perhaps more than anything, though, Darcy quoted Todd Tomalak of housing research firm Zonda, who refers to this decade—2020-2030—as the Golden Age of Remodeling. Due in large part to the fact that there are currently 22 million homes that are 20-39 years old, these homes are in the sweet spot for remodeling.
Darcy also predicts that the largest group of remodeling decision-makers is women in their 30s and 40s. “They want luxury, they want gourmet appliances and plumbing fixtures,” Darcy states in the Designers Today article. “Even better, they use a professional designer.”
What About New Construction?
While 2024 looks to be a landmark year for remodeling, don’t discount an increase in new high-end home builds. As we shared in our first-ever State of the Affluent Audience™ report released earlier this year, luxury home sales haven’t been as impacted by higher interest rates as other real estate market segments. Additionally, Affluent Consumers are able to obtain better rates as well as non-traditional types of loans as they are seen as a lesser risk to lenders.
Perhaps most noteworthy, though, are two emerging trends that point to an increase in new high-end construction: HENRYs and multi-generational living. HENRYs, which stands for “High Earners, Not Yet Rich,” are a demographic that is coming into their wealth. They’re looking for a bespoke living situation that’s both elegant and easy at once. Multi-generational living took flight during the pandemic as families hunkered down together during the long period of isolation. Today’s high-end homes are being designed with this preference in mind. Plans include multiple primary suites and a heavy focus on health and wellness, prioritizing physical and mental wellness through both design and features.
As we embark on the second quarter of the year, we share these insights and encourage you to forge or renew meaningful relationships with your local industry professionals. Nurture your connections with local kitchen designers and luxury home builders so that when it’s time for their clients to select their premium and luxury appliances, whether for a remodel or a new build, your business is top of mind.
Keep up with the latest industry trends. Click here to download the State of the Affluent Audience report, created exclusively by AffluentBridge™.