The end of the seesaw on which the window industry has been perched for the last five years is once more lifting. After steady sales increases through the years of the housing boom, window sales began to fall after hitting a peak in 2006. As both new-home construction and renovation activity began to slip, total window industry sales fell correspondingly: from the 66.7 million units shipped in 2006, to 38.9 million in 2009.

What broke the industry’s fall in that year was the tax credit offered as part of the Obama administration’s American Recovery and Reinvestment Act. Year two of the tax credit — 2010 — saw some window replacement companies such as A.B.E. Doors & Windows, in Allentown, Pa., booked from October through the last day of December and straining to install product before the year ended. With time running out, there were so many customers looking to buy windows before the end of 2010 that one Midwest window dealer compared demand to a salmon run.

Tax Credit Hangover Hurts Window Sales

What happened next was predictable: the run ended. When the tax credit went away on Jan. 1, 2011, demand for windows — mostly in the remodeling/replacement segment — dropped. The consensus among window replacement companies is that the 2010 tax credit took many of 2011’s potential window buyers out of the market by prompting them to move quickly to get the credit.

According to a report compiled by Ducker Worldwide and issued in May by the American Architectural Manufacturers Association (AAMA) and the Window and Door Manufacturers Association (WDMA), overall window market demand fell 9% in 2011 over 2010, to 37.9 units shipped, making 2011 the low point for window shipments.

Most of that reduced demand was in replacement/remodeling, the greater portion of today’s window market, where shipments declined from 29.6 million in 2010 to 26.1 million in 2011, a 12% drop. Some home improvement companies, such as Selig Construction, in Chico, Calif., scaled back their window efforts, shifting energies into other products, such as walk-in tubs.

Window Demand Set to Lift

The good news for them, and for anyone selling windows and doors, is that demand for those products will lift as both new construction and remodeling/replacement grow, beginning in 2012 and continuing through 2015, the last year for which the AAMA and WDMA provide a forecast.

In the latest update to the AAMA/WDMA report, the study's data suggests multi-family and single-family starts “are expected to experience a slightly better increase than what was initially thought, up to 19% over 2011 with additional increases in 2013 and 2014.” The report notes that “residential improvement expenditures are expected to see a similar shift.”

How much of a shift? Forecasts by the Joint Center for Housing Studies of Harvard University, which tracks and analyzes movement in the remodeling market, predict a 1% increase this year in home improvement sales in its latest report, issued last June — modest, but the beginning of a trend. The report’s authors predicted that “after several false starts, there is reason to believe that 2012 will mark the beginning of a true housing recovery.”

Citing its Leading Indicator of Remodeling Activity, the Joint Center notes “that annual homeowner improvement spending may reach double-digit growth by the first quarter of 2013.” This is welcome news for many, especially those who sell and install windows.

—Jim Cory is the editor of REPLACEMENT CONTRACTOR and a contributing editor to REMODELING.