VOL. 118 | NO. 11 | Tuesday, January 20, 2004
Memphis Remodeling Market Continues to Improve
The Daily News
Last summers major wind storm was devastating for Memphis.
But it did wonders for the areas remodeling market, which
saw a heavy increase in business.
I think (the year) ended very strong because of the
unfortunate circumstances of the storm, said Mike Sinquefield, chairman of the
Memphis Area Home Builders Associations Registered Remodelors Council and a
principal with Sinquefield, Chamberlain & McCreery. Everyone I know in
this business took on several additional tasks because of the storm.
People who normally dont do insurance repairs even got
involved in that.
Strong showing. Industry statistics from MAHBA back
up Sinquefields assessment. A third-quarter Remodeling Market Index, based on
a survey of industry professionals, showed year-over-year gains of 3.7 points
for current market conditions and 6.7 points for future expectations.
It looks like its going to be a strong first quarter,
Sinquefield said. Everybody seems to be positive going in. It looks like the
economy is on the upturn and everybody is willing to turn over some dollars to
The storm helped feed that scenario. But for some, including
John Catmur of Catmur Development Co. Inc., business picked up before the
All in all, it was slow in the spring for me and then
before the storm hit, things really opened up, he said. The storm just added
more work. Ever since the storm, things have been pre-9/11.
Sept. 11 effect. Business for Catmur before the
terrorist attacks of Sept. 11, 2001, was excellent, with $4 million in total
yearly sales, he said.
Now, its close to $1.8 million in sales, he said. Prior
to (Sept. 11), it was a 10-year run of great sales.
Sinquefield said people guarded their money much more carefully
following the attacks.
It took a while to recoup from that, because when that
happened, people started losing money in the stock market and didnt know what
the future of the nation would be, he said. They actually canceled contracts
because they didnt know where all that was going. It was probably six to nine
months that followed that our industry suffered, but after that it really
picked up, especially in the last year.
Improved cash flow. Part of the recent pickup springs
from low mortgage interest rates and a rebounding economy. Because many
homeowners are refinancing their mortgages, they have been able to use the
extra cash for home improvements.
People refinance their homes and they choose to do a
remodel or renovation or an addition because of those low interest rates,
Sinquefield said. People like where they are. They get tied to a piece of
Some people like to move up and some people like to fix up
what they have, and thats what we ran into this summer. There are a lot of
people willing to do that.
Investment options also are improving, meaning cash is
easier to come by, one contractor said.
I think just because people begin to see the economy
improving, it all ties together, said Eric Meyers of Meyers-Bradick
Associates. When your home value goes up and when your investments start to
perform, with the level of work we do, people arent financing the work. People
are paying cash for this stuff.
They see their investments start to perform, they say now
is the time, because suddenly the money is there again.
High-dollar renovations. Faye Cook, owner of Memphis
Home Improvement Co. Inc., said she has seen higher-priced projects in recent
This past year has been fabulous, she said. Weve done
some of the largest projects weve ever done. People arent moving theyre
Cook has done several second-floor expansions in homes that
were built with unfinished rooms.
I think its going back to the trend of the 60s and 70s,
she said. Theyre just updating homes.
Popular projects. The hot jobs have been kitchen and
People like to do those because thats really a big living
space for people, Meyers said. People living in the older houses, built in
the 40s, 50s, 60s, 70s, those houses have bathrooms that are generally
about 5 feet by 8 feet, and its nothing more than a tub, a sink and a
Homeowners are also enlarging kitchens to create friendlier
These old houses, the kitchens are tiny, Meyers said.
When you get five people in the kitchen, you cant move around. Its the same
thing with master baths. Theyre very luxurious now. They have Jacuzzi tubs and
the big two-person showers, luxury finishes and low maintenance.
Minor adjustments are being made in interior finishes, and
homeowners are upgrading to new products and styles. Barry Shaw of Highland
Systems said his countertop business grew by 15 percent in 2003. He expects
that growth to continue in 04.
Holiday break. Sinquefield said late spring and
summer tend to be the busiest times of the year for the remodeling industry. In
the fall, business slows down due to the approaching holidays.
Very few people want you to start tearing out their
kitchens right before Thanksgiving and Christmas, so theres always that slow
period, he said. January, February, March, youve got people going to the
home expos and shows, and then late spring theyre ready to go.