ATLANTIC CITY, N.J. — Despite predictions the remodeling industry could take a hit this year following last year's outstanding sales, window manufacturers are experiencing a strong first quarter and many expect a good 1999.
Exhibitors in the vinyl replacement window industry at the NARI RemodelAmerica show, held March 4-6 in Atlantic City, agreed that the market still is good due to a mild winter in northern states.
In fact, December was Patriot Manufacturing Inc.'s best month for sales in 1998, said Brian Samuel, director of sales and marketing for the Hammonton, N.J., window maker.
Though it's really too early to tell, he predicts a decrease in sales in the normally busy summer months because the winter was mild enough for homeowners to replace their windows earlier.
People are continuing to add on sunrooms and bedrooms, and new construction is booming, said Ed Racich, a representative for Farley Windows Inc. of Alexandria, Ontario.
The Canadian company only distributes its windows as far south as North Carolina, so the rise and fall of its sales rest largely on winter weather, he said.
``All we can hope for is that people will keep putting those dollars in for remodeling that they have been,'' Racich said.
And that's just what he thinks will happen. Though Farley always expects an increase in sales, it may be a small, steady rise of 5-7 percent this year, he said.
Last year, Farley experienced a 12 percent sales hike, reaching about $40 million.
With the stock market reaching all-time highs and mortgage rates plummeting to record lows, an astounding 66.3 percent of American families owned their own homes last year, the highest percentage in history, the federal Housing and Urban Development office reported in January.
Numbers like that can only lead to additional remodeling, and Gregg Proscia, vice president of sales and marketing for Silver Line Windows, believes his company will see the effects of that trend.
Though HUD reported the Midwest had the highest number of homeowners in 1998, at 71.1 percent, the South wasn't far behind, with 68.6 percent. Proscia believes the next big housing boom will occur in the South.
Kermit Baker, a senior research fellow and project director of the Remodeling Futures program at Harvard University's Joint Center for Housing, isn't as optimistic.
Considering 1998's year-end sales, he expects the remodeling industry to plateau or see only a maximum 2 percent increase.
``The range of activity is somewhere between slow growth and slow decline,'' Baker said in a March 11 telephone interview.
Unless mortgage rates drop another percentage point, it's difficult to see a new round of accelerated remodeling, Baker said.
``1998 was a gangbuster year. Heading into '99 they don't see any clouds on the horizon. There will be bumps in the road. I just don't think they know where they are,'' he said.
While the first half of 1999 is looking solid, the second half still is too far away to predict. However, Baker said the remodeling industry could experience a mushroom effect of the economic crises crippling Asia and Russia, but those effects would be a secondary cause to any loss of sales.