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Barometers { A look at key statistics & trends shaping the industry } 6 | Kitchen & Bath Design News | April 2015 S upported by an ar- ray of strengthening fundamentals, the na- tion's housing market opened the New Year on its contin- ued, albeit up-and-down, path to recovery. Among the key statistics and forecasts released in recent weeks by government agencies, research frms and industry- related trade associations were the following: HOUSING STARTS Builder confidence in the market for newly built, sin- gle-family homes is reported down slightly, although the dip is attributable less to weakening market condi- tions than to supply chain issues such as lot and labor shortages, as well as tight under w r it ing sta nda rds, the National Association of Home Builders said last month. "Even with the slight slip in confdence, we expect the market to improve as we enter the spring buying sea- son," said NAHB Chairman Tom Woods. The sentiment is echoed by NAHB Chief Economist Dav id Crowe, who said the Washington, DC-based trade association is "expecting solid gains" in housing this year, buoyed by sustained job growth, low mortgage interest rates and pent-up demand. EXISTING-HOME SALES The market for existing- home sales "got off to a d i s app oi nt i ng st a r t" to begin 2015, although "all indications point to modest gains" ahead, according to the chief economist for the National Association of Re- altors. NAR chief economist L aw rence Yu n sa id la st month that current signs in- dicate that many buyers are overcoming tight supply to sign contracts at a pace "that highlights the underlying demand that exists in today's market." Contract activity is up compared to a year ago, despite compa rable inventory levels," Yun said, adding that "the diference this year are positive factors supporting stronger sales, such as slightly improving credit conditions, more jobs and slower price growth." Total existing-homes sales in 2015 are forecast to be 5.26 million, a gain of 6.4% from 2014. The national me- dian existing-home price is expected to rise 5%. In 2014, existing-home sales fell 2.9% and prices rose 5.7%, the NAR said. CABINET & VANITY SALES Sales of kitchen cabinets and vanities began 2015 on a positive note, gain- ing in Ja nua r y over t he same month a year ago, the Kitchen Cabinet Manufac- turers Association said last month. According to the Reston, VA-based KCM A, manufacturers participating in the association's monthly "Trend of Business" survey reported that January sales of cabinets and vanities rose 4.6% over January, 2014. Although sales of stock cabi- nets fell 4.9%, semi-custom cabinet sales gained 13.8% and custom cabinet sales rose 13.3%, the KCMA said. APPLIANCE SHIPMENTS Domestic shipments of major home appliances rose sharply in February, with year-to-date fgures through the frst two months of 2015 up over the previous year's numbers, ac- cording to the Association of Home Appliance Manu- facturers. The Washington, DC-based AHAM reported last month that February, 2015 appliance shipments totaled 5.29 million units, up 11.5% from the 4.75 million units shipped in February, 2014. Year-to-date shipments through February were up 4.9% over the total for the first two months of 2014, AHAM said. Cleveland, OH — The U.S., the world's largest market for cabinets, will see "strong increases" in annual demand through at least 2018, while the continued recovery in residential construction will similarly fuel growth in both North American and global demand for countertops. Those are the fndings of a newly released pair of studies from The Freedonia Group, Inc., a Cleveland-based industry market research frm. Following the collapse in housing construction that began in 2006, demand for both cabinets and countertops declined for several years. However, the current recovery in residential construction is expected to boost U.S. cabinet demand to about $16 billion, and North American demand to $18.6 billion, in 2018, according to Freedonia. North American countertop de- mand is projected to grow to an annual market of 80.3 million sq. meters in 2018 (see related chart, above). "In addition to stronger construction activity, interest in more expansive kitchen and bathroom designs will boost unit demand for cabinets, while rising interest in premium features and fnishes will support value growth," the research frm said. Gains in North American countertop demand will also ben- eft from growing consumer preference "for spacious kitchens and multiple bathrooms that require more countertop area," researchers added. Growth Seen In Demand For Cabinets, Countertops MARKET ANALYSIS Market Continues Its Crawl Toward Recovery PROJECTED NORTH AMERICAN DEMAND FOR CABINETS & COUNTERTOPS North American demand for both cabinets and countertops is expected to strengthen at least through the next three years as the residential construction market continues its recovery and spurs homeowner interest in more expansive kitchen and bath designs, as well as premium features and fnishes ( see related story below ). As refected in the graphic above, while the years between 2008 and 2013 witnessed either negative or anemic annual growth, the period between 2013 and 2018 anticipates considerable improvement. Source: The Freedonia Group, Inc. 2008 2013 2018 2008–13 2013–18 COUNTERTOPS MILLIONS OF SQ. METERS % ANNUAL GROWTH 65.38 67.85 80.30 0.7 3.4 2008 2013 2018 2008–13 2013–18 CABINETS BILLIONS OF DOLLARS % ANNUAL GROWTH 14.86 13.78 18.66 -1.5 5.5