Houzz released its Renovation Barometer for the third quarter of 2015 today, and the findings from the report show that despite lower 3Q scores, there is confidence that the home improvement market is improving.
One of the notable findings were moderate-to-severe labor shortages across a wide range of specialized trades. Topping the list was carpenters, whom 45% of U.S. firms report to be in short supply. This was followed by general laborers (36%), framers (25%), tiles (22%), and drywall (21%).
The Houzz Barometer tracks quarterly fluctuations in business activity related to renovation of owner-occupied existing homes. The study is conducted quarterly and presents an analysis of responses to an online survey sent out to a national U.S. panel of architects, interior designers, general contractors/remodelers, design-build firms, and building/renovation and landscape/outdoor specialties.
Outside of a perceived lack of labor there was still good news to be found within the barometer. There were high readings (between 65-73 out of 100) in all categories. Designers, General Contractors (GCs) and Remodelers, and Design-Build had scores of 67, 72, and 70 in the third quarter of 2015. While these are all high readings they represent losses of 8%, 8%, and 10% respectively from the second quarter of this year.
For this report, Houzz asks professionals to indicate whether certain business activities, increase, decreased, or stayed the same for a specific quarter. Business activities are made up of the number of inquiries, new projects/orders, and the size of new projects/orders. Across all industries, these three metrics received high scores but were down form the second quarter possibly due to seasonal slowdown.
Year-over-year confidence is also measured by the barometer. Designers, GCs and Remodelers all have persistently high scores in the market improving year-over-year. The three markets have scores of 74, 78, and 79 respectively. These scores are only slightly lower than the year over year scores from the second quarter.
Gross revenues and profits for this year so far are at or above pre-recession levels to two-thirds of firms. Further evidence that despite a cloudy barometer for this quarter, there is an overall sunny forecast in the home improvement market.
The survey for the current quarter was fielded Sept. 27 - Oct. 12, 2015. Total surveyed 2688: 351 architects; 614 interior and building designers; 539 general contractors/remodelers; 355 design-build firms; 550 building/renovation specialties; and 279 landscape/outdoor specialties.