Spray Foam Industry Measures Up to Recent Trends in Remodel and Retrofit Construction

JUPITER, FL–January 29, 2013–While much of the country is still reeling from the recession, particularly in terms of unemployment, economic activity in numerous industries has returned to pre-recession levels over the course of 2012. Construction is most notable among the revived industries, due as much to its relationship to the housing crisis as its still-improving stretch of economic outlooks. NAHB released report after report last year signaling homebuilder confidence to be, essentially, back to normal. But that was just new home construction. On the other side of the coin, a recent NAHB report showed home remodeling and retrofit construction activity is also revitalized, and is in fact the highest it's been in years.

NAHB's Remodeling Market Index (RMI) takes the pulse of nationwide retrofit efforts on a quarterly basis. The RMI is based on a scale of 100, wherein a score of 50 would translate to equal numbers of remodelers reporting increased and decreased activity for a given yearly quarter. Nationwide RMI had been stuck primarily in the 40's through most of the current recession, although it got as low as 22 in 2008. It wasn't until Q3 2012 that RMI reached 50 for the first time since the housing crisis. NAHB's most recent report, for Q4 2012, announced an RMI of 55, which is its highest level in nearly nine years.

There are a couple of factors affecting the RMI, which is tabulated in four regions–Northeast, Midwest, South, and West–before calculating a national average. More broadly, remodeling activity has seen a bump resulting from people moving into existing homes and subsequently remodeling them. Also affecting this most recent national average is a tremendous spike in the Northeast region due the damage caused by Hurricane Sandy. RMI in that region alone jumped 24 points to stand at an RMI of 64, a 60% increase.

While much of the activity referenced in NAHB's report speaks of remodeling efforts toward kitchens and bathrooms, the spray foam industry is benefitting from these recent trends as well. Spray Foam Leads has reported a blazing start to 2013, with January slated to be it's best month ever. Although leads for spray foam projects are coming in from all over the country, there are, or course, numerous job leads coming in for crawlspace applications in the Northeast. However, there has also been a high volume of leads coming in from the other three regions for retrofit insulation projects, commercial roofing applications, and insulation for new home additions.

Beyond remodeling and retrofit, NAHB has just announced that new home construction will continue its positive upturn through 2013. Even still, NAHB's Cheif Economist, David Crowe, said the bright outlook has a few caveats. First, new home construction is split between single family home and multifamily home construction, with the latter looking more promising. Though SPF insulation has been a part of the new home construction upturn in either case, and the preference toward multifamily home construction was evident in our coverage of such projects in Chicago and Maine.

Another caveat about the rally in new home construction, according to Crowe, is the threat posed by, among other factors, tight mortgage lending and rising material costs. The latter is particularly relevant to the spray foam industry, as a major hurdle for new homeowners opting for SPF insulation is justifying the upfront costs associated with its installation. So, it seems that the spray foam insulation industry, if it's to keep pace with these recent construction trends, should make a consolidated effort to effectively communicate the long-term energy savings and expense reductions associated with SPF, even more than it already does.

About NAHB: NAHB is a trade association that helps promote the policies that make housing a national priority. Since 1942, NAHB has been serving its members, the housing industry, and the public at large. For more information, please use the link provided below.

About Spray Foam Leads: SprayFoamLeads.com is CRM (customer relationship management) solution for spray foam contractors. Members can view and purchase real spray foam sales leads for spray foam insulation, foam roofing or retrofit / injection foam jobs that come in daily via the Spray Foam Local Marketing Network. For more information, please use the links provided below.