Home remodeling businesses see boon in Valley

  • A barn in Southampton in the process of being remodeled by the firm Valley Home Improvement. —SUBMITTED PHOTO

Monday, February 12, 2018

NORTHAMPTON — With a seller’s market again on the horizon for the Pioneer Valley’s real estate, those in the home remodeling business see that trend as a likely boon for their businesses.

“I think it will be another strong year building off of 2017, with relatively lower interest rates,” Steven Silverman, the president of Valley Home Improvement, told the Gazette. “With the housing stock being fairly tight, it definitely is incentivizing people to remodel their homes as opposed to trading up or moving out.”

Silverman isn’t alone in that prognosis. The Joint Center for Housing Studies of Harvard University projects that in the coming year, homeowner spending on improvements and repairs will increase 7.5 percent from 2017 spending. An economy making steady gains, increasing home sales and sales prices are all driving that home improvement demand, according to the Joint Center.

“Despite continuing challenges of low for-sale housing inventories and contractor labor availability, 2018 could post the strongest gains for home remodeling in more than a decade,” Abbe Will, research associate in the Remodeling Futures Program at the Joint Center, said in a statement. “Annual growth rates have not exceeded 6.8 percent since early 2007, before the Great Recession hit.”

Silverman said he has seen signs of that positive outlook recently, with his company’s average project size increasing.

“So far it’s showing strong signs,” added Chris Jacobs, owner of the Northampton-based restoration, renovation and remodeling company Barron and Jacobs. “We’ve sold a couple jobs, which is always good in January and February.”

That’s not to say that the industry doesn’t face any challenges. As alluded to by Harvard’s Joint Center, the availability of an appropriately qualified labor force can limit the remodeling industry’s potential for growth.

“Another thing that’s just something to be watching and monitoring is the increase in material costs,” Silverman said. After devastating hurricanes in the South, he said, the price of plywood has increased as those communities begin rebuilding.

Silverman said his suppliers have told him to expect a 7 to 10 percent increase in softwood lumber supplies. Other reasons for that increase include a U.S. tariff on Canadian softwood-lumber imports and a shortage of trucking to get materials to market.

In addition, in the wake of the 2008 financial crisis increased regulations on lending have slowed down the process of homeowners borrowing money to make improvements, Jabobs said.

“The banks are really backed up, it can take months to get financing for a customer,” he said. “A lot of the customers get really frustrated with the process, so that’s probably one of the bigger challenges.”

Despite those obstacles, however, those in the industry seem primed for another great year ahead.

“We’re off to a good start,” Jacobs said.

Dusty Christensen can be reached at dchristensen@gazettenet.com.