Home Remodeling Is Bright Spot For Kentucky Economy
Spending for home improvement up 10%, compared to 3% across the United States as a whole.
Reported by: Tom McKee
Web produced by: Neil Relyea
 Cindy Falk spent months deciding whether to have a new home built or buy one already on the market and remodel it. The search led her to Ft. Thomas where she bought a ranch house and is the process of completing a $40,000 renovation project. "I am convinced that I've probably saved between $100,000 and $150,000 by remodeling that house," Falk said. Falk's experience isn't unique, according to Jim Stegman, of Jim Stegman Construction and immediate Past-President of the Home Builders Association of Northern Kentucky.
"We're up 10% locally," Stegman said about home improvement spending comparing the first three-quarters of 2007 with the similar time period of 2006. "Nationally, I think the statistic is that remodeling is down 3%," Stegman added. January is normally a slow time in the home remodeling business, but Stegman says that's not the case this year. "This January we've had more activity than any other January and we've been in business 20-years," he said. That's in spite of a national economy on a roller coaster ride and sales of new and existing homes sluggish, but showing signs of rebounding.
Why remodel instead of buy a new or existing house?
Falk says it's simple. "The risk factor seems to be a lot less than if I started on a new project from scratch," she said. Workers from Stegman's company were hard at work Monday beginning a new kitchen in the home of John Bourke on Henry Avenue. He chose to remodel, rather than move. Stegman says that's a popular choice these days. "I do think it has a lot to do with the housing slump in new homes," said Stegman. "People want to stay put and do more remodeling than moving."
Kitchen Designer Molly Wagner sees that trend come to life every day. She's overseeing the Bourke's new kitchen and says people aren't skimping on what they need, but neither are they overspending.
"As long as they're getting the value out of what they put into it, that's what they're looking for," Wagner said. Contractors aren't the only ones touched by the remodeling increase. Suppliers of building materials are seeing it as well. "Remodeling has been the bright side of our business," said Ken Grause of Pilot Lumber, which has facilities in Bellevue and Alexandria.
"The new construction side – new homebuilding – has been the negative side of our business," Grause said. Grause says most of the business is coming in kitchens, baths and decks, but he still senses a reluctance by many people to spend because their confidence in the economy is low. "I'm hoping our little tax package that's coming this spring is going to help generate some of that," Grause said. It's been a tough week for Pilot Lumber. Overall slow sales have meant laying off one full-time worker, cutting back the hours of other full-timers from 40 to 30 hours a week and reducing the salaries of owners. "It's all voluntary, but we knew what we had to do," said Grause.
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