The tables have turned in the home improvement world. During the red-hot housing market, finding a contractor who would perform simple home improvement jobs was nearly impossible. As the market has iced over, renovation specialists are finding that the shoe is definitely on the other foot.
In the heyday of the housing boom, a home building contractor couldn't walk out his front door without running into leads for new work. Homeowners were happily tapping into ever-increasing lines of credit to perform home improvement projects. Often the tasks were grand in scope, including major additions or complete kitchen renovations.
As the economy has gone ice cold, homeowners are reconsidering their spending habits, and home building specialists are feeling the effects.
Back to renovation basics
Home improvement projects are indicative of the economy. People, no longer thinking about their dream houses, are doing their best simply to keep their homes.
In the renovation industry, that means grandiose projects have gone by the wayside. Generally, people are now performing only basic maintenance: replacing rotting roofs, or fixing cracks in the foundation. For contractors, this is the type of work that many passed up during the boom times. Many are reporting that work is off up to 40 percent.
Instead of backlogs, renovators are on a job-by-job basis, and finding that work isn't easy. Phones once rang off the hook, but now, home improvement specialists are the ones doing the calling. Many have been forced to employ direct mail campaigns and other types of tactics to drum up business.
Do-it-yourselfers pulling back
If renovators are finding less work available, then the logical assumption is that homeowners are now adopting a do-it-yourself approach. It should be gravy time for stores like Lowe's and Home Depot, which cater to people who prefer to take hammer in hand and save a few extra bucks.
It should be gravy time, but it's not. Home Depot recently reported that its third-quarter profit fell by 31 percent. While the numbers are better than what analysts had expected, the trend is still indicative of the slowdown. Included in those store closings is one of Home Depot's flagship stores, marking the first time the chain has ever closed one of these for performance reasons.
Municipalities are noticing that people are also pulling back on building permits. Many are filing for a renovation or extension, but then neglecting to pay their fee and pick up a permit. Others are extending the time they have to build by paying an additional fee, and then waiting to start construction.
Home building has ground to a halt during the recession, but home improvement projects have also slowed. Renovation experts are finding that their goldmine industry has slowed significantly. Instead of big jobs backordered on the books, home improvement specialists are knocking on doors looking to make basic repairs. Like the rest of the country, this industry will have to grit its teeth and soldier on through the tough times.