Kitchens and baths are the heart and soul of our homes, representing a $134 billion industry, according to research released today by the National Kitchen & Bath Association (NKBA).
More than 10 percent of American homeowners did a kitchen or bath remodeling project last year for a total kitchen and bath remodel and replacement market of $85 billion. The kitchen and bath market for new construction is $48.6 billion.
The NKBA report, “Estimated Market Value for the Kitchen & Bath Remodeling and New Residential Construction Markets,” finds that each year homeowners remodel upwards of 10.2 million kitchens — roughly one in 10 of all households — and 14.2 million bathrooms, two of the most important rooms in a home. Further, annual new home construction adds roughly 1 million kitchens and 2.3 million bathrooms to the marketplace.
Nearly half (48%) of kitchen remodel and replacement projects were budgeted at $15,000 or more; while one-in-five Americans (21%) spent $7,500 or more to remodel their master bathroom, according to the report released at KBIS, the association’s annual show.
Other insights into the KITCHEN segment of the industry include:
- 10.2 million — or roughly one in 10 of all households — undertook a kitchen remodel or replacement project during 2015.
- Nearly half (48%) of kitchen remodel and replacement projects were budgeted at $15,000 or more.
- However, there was a great variation in the kitchen project budget, pointing to more partial upgrades, rather than complete remodels. For example, 63% of respondents spent less than $5,000 on their kitchen remodeling or replacement project.
- Similar to previous generations, younger homeowners are more inclined to DIY these projects and baby boomers are more inclined to hire the expertise.
- The overall estimated retail market value for products among households undertaking kitchen remodel or replacement project activity is $49.7 billion.
Other insights into the BATHROOM segment of the industry include:
- 14.2 million — or just under 13% of all households — undertook a bathroom remodel or replacement project during 2015.
- 21% of respondents spent $7,500 or more to remodel their master bathroom.
- As with kitchens, there was a significant variation in spending for bathroom remodels and replacements. For example, nearly four-in-ten (38%) of respondents budgeted less than $2,500 for their bathroom remodeling or replacement project.
- The overall estimated retail market value for products among households undertaking a bath remodel or replacement project is $35.5 billion.
“This NKBA research is the first in a decade to quantify the size of the kitchen and bath industry,” says NKBA CEO Bill Darcy. “Our $134 billion industry has a major impact on the U.S. economy, representing nearly a fifth (18%) of the total residential design and construction marketplace.
The report is based on an online survey fielded in early 2016 that generated 1,078 responses representing homeowners, builders/remodelers and general contractors’ views of projects completed during 2015. The study contains a breakdown of kitchen and bath market activity, including kitchen and bath remodeling by segment product behaviors, average amount spent on products, estimated retail market value by product and a breakdown of kitchen and bath market activity by housing type.
“Kitchens and bathrooms are big business,” echoes Manuel Gutierrez, NKBA Consulting Economist and principal of ManuelDJGutierrez, LLC. “The $134 billion residential construction and remodeling market for American kitchens and baths is weighted toward remodeling projects, with $85.2 billion (64%) allocated to remodeling and $48.9 billion (36%) earmarked for new construction.”
“We remain cautiously optimistic on the remodeling outlook simply because the number of houses in the U.S. — the so-called stock of homes — increases year after year,” continues Gutierrez. “There are currently more than 135 million homes in the U.S. that are in need of constant remodeling and improvement, particularly homeowner and rental units. This drives a constant stream of demand for products and services in the remodeling market.”