Mixed remodeling forecast for 2012

After a 2011 that failed to live up to expectations, remodelers are not as optimistic as they were a year ago that business is going to improve.

Just less than half of remodelers expect revenue to increase in 2012, according to the latest Professional Remodeler research. Twenty-nine percent of remodelers expect no change next year, while 23 percent expect revenue to decrease.

“I see some cautious optimism, but things seem on the edge and could fall again really easily,” says a design/build remodeler from the Northeast.

Says a Texas full-service remodeler: “The news is so bad consumers are going to go back to ‘wait and see’ before they buy.”

That pessimism is a marked contrast from the end of 2010, when remodelers were very hopeful about 2011. At that time, 64 percent said they expected their revenue to increase and only 15 percent expected business to slow.

Unfortunately, a stubbornly weak economy and continuing pressure on the housing market combined to make reality a lot less attractive, with only 29 percent of remodelers reporting their business picked up this year compared to 2010 and 42 percent saying that revenue was down.

“We need a bit of a burst to generate some demand out there,” says Kermit Baker, director of the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. “Folks are just nervous about getting into home improvement projects with the economy as weak as it is.”