4.1% Growth Projected for 2019 Home Improvement Products Market

HIRI/IHS Markit forecast expects 4.1% growth in the home improvement products market in 2019 after a strong 4.6% in 2018.

Total home improvement products sales are expected to increase 4.1% in 2019 to $405 billion in total sales. The Professional Market is expected to increase 4.5% in 2019 over 2018 and the Consumer Market will see a sales increase of 3.9%.

The National Economic Outlook

  • New fiscal stimulus from the Bipartisan Budget Act of 2019 will add to growth over 2020 and 2021, while improved financial conditions also support the near-term outlook. We have lowered our outlook for real GDP growth slightly in 2019 from 2.4% to 2.3%. Projections were revised up to 2.4% in 2020, and to 2.1% in 2021.
  • The unemployment rate is expected to reach a cycle low of roughly 3.3% in early 2021, where it will linger before starting a gradual rise in late 2021, once GDP growth drops to below trend.
  • After a soft start to the year, inflation is firming and core personal consumption expenditures inflation is projected to run above an annualized pace of 2% in the second half. Core Inflation is then expected to remain slightly above 2%.
  • Upward revisions in the data on household incomes, and recently strong momentum in consumer expenditures, resulted in a significant upward revision to our forecast of consumer spending this year and next, to 2.7% and 2.9%, respectively.

Outlook for the Home Improvement Products Market

  • Growth in the home improvement products market appears to have plateaued recently and is poised to slow down in the coming years. We have revised our forecast for 2019 sales down compared with our March report, with total sales in nominal dollars now projected to increase 4.1% to $405 billion. Consumer Market sales are expected to increase by 3.9% in 2019 and Professional Market sales by 4.5%. 
  • We expect the growth of home improvement product sales to slow slightly over the following three years, with growth averaging 2.6% in 2021 to 2023. Consumer Market growth will be stronger compared to Professional Market growth.

Growth rates of market size by segment for a 5-year historical period, the current year, and the remaining four years of the forecast period are as follows:

  2014-2018 2019 2019-2022
Current Prices:      
Consumer Market 4.8% 3.9% 3.6%
Professional Market 8.5% 4.5% 0.6%
Total 5.9% 4.1% 2.7%
Constant Prices:      
Consumer Market 4.5% 2.2% 2.9%
Professional Market 6.6% 3.3% -0.6%
Total 5.0% 2.5% 1.9%
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