Hardwood Floors August/September 2017

By Stuart Hirschhorn

for 6.1 percent of commercial contract flooring sales. This is up from 4.9 percent in 2012 and only 2.9 percent in 2007. Wood flooring’s share of total flooring purchases for new nonresidential building construction is estimated to have been some 13.5 percent during the recovery. This is up from about 10 percent in 2007. New nonresidential construction also accounted for about 10 percent of total U.S. wood flooring sales. The gains in wood flooring commercial sales were concentrated in the building or remodeling of hospitality facilities and office and retail structures. Positive trends driving residential replacement, builder, and commercial market sales are estimated to continue into 2017. Manufacturers and marketers are expected to benefit from increasing personal income, relatively low interest rates, rising home prices, and growing corporate profits. Catalina Research is tracking wood flooring industry trends during 2017 including an analysis of U.S. manufactured versus foreign- sourced products, customer demographics and factors driving demand, and the outlook for 2018. This data and information will be part of the Catalina Report onWood Flooring, an Executive Summary of which will be available to all NWFAmembers within the next few weeks. For more information contact Stuart Hirschhorn, Director of Research at 561.988.0853 or shirschhorn@catalinareports.com. Stuart Hirschhorn is Director of Research for Catalina Research Inc. in Highland Beach, Florida. He can be reached at 561.988.0853 or shirschhorn@catalinareports.com.

a 15.4 percent compound annual growth rate between 2012 and 2016. This pushed builders’ share of total wood flooring sales to 26.2 percent in 2016. This is up from 23 percent in 2007. As a result, wood flooring purchases per new housing unit built have increased sharply during the past decade. Wood flooring purchases per new housing unit trended upward as homebuyers increased their preference for larger, more- expensive homes. In 2016, the average value per new single-family home sold is estimated to have reached $372,500 or $141.10 per square foot, both of which are records. In addition, the average size of a new single-family home sold has increased by about 8 percent during the past decade. Wood flooring manufacturers have taken advantage of these trends by offering homebuyers a wider array of wood flooring options that can be used in kitchens, family additional inroads in the commercial remodeling and replacement (or commercial contract) market. Commercial contract sales are estimated to have accounted for about 9 percent of total industry sales in 2016. This is up from 8 percent in 2012. Commercial contract sales, consisting of replacement sales or the finishing of new gray space by new occupants, are estimated to have increased by about 15.6 percent per year between 2012 and 2016. Some of the gains in commercial contract sales are due to increased usage of wood flooring in this market. In 2016, wood flooring is estimated to have accounted rooms, home offices, and bedrooms with improved scratch and moisture resistance. At the same time, wood flooring made

Photo courtesy of Somerset

population, two-person households, and the South andWest regions. Some three-quarters of hard surface flooring purchases are made by households with incomes of $70,000 or more. Since wood flooring selling prices are at the higher end of the hard surface flooring market, wood flooring manufacturers and marketers may have a heavier dependence on this demographic. Baby Boomers remain a target market despite this group entering retirement age. Households headed by 55- to 74- year olds accounted for 42.2 percent of total hard surface flooring purchases in 2015, up from 23.2 percent in 2007. Marketers may begin to concentrate on the millennial generation since this huge potential market began to increase their importance to sellers of hard surface flooring during the current recovery period. Builder purchases also contributed to growing residential wood flooring sales. Builder purchases are estimated to have increased their wood flooring purchases at

the magazine of the national wood flooring association

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