Current Affairs

March 23, 2025

Home Remodeling Surge

Remodeling market soars, but faces key challenges

By Dakota Smith

March 20, 2025 | 9:42 am CDT

CAMBRIDGE, Mass. — According to Improving America’s Housing 2025, a new report from the Harvard Joint Center for Housing Studies, the US remodeling market soared above $600 billion in the wake of the pandemic and remains 50 percent above pre-pandemic levels despite recent softening.

 However, industry fragmentation, inflation, and a shortage of skilled trade labor jeopardize the ability of the industry to fully meet demand. The strength of the remodeling market has been supported by the aging of homes and households, as well as record-high property values, but far more investment is needed to address growing needs for energy efficiency and disaster resilience of the country’s 145 million homes.

Key takeaways from the report: 

The pandemic fueled unprecedented spending on remodeling.

Home improvement and repair spending vaulted from $404 billion in 2019 to $611 billion in 2022, and is expected to remain above $600 billion through 2025. Homeowners remain focused on replacement projects such as roofing, windows, and HVAC, accounting for 49 percent of improvement expenditures in 2023. On average, homeowners spent almost $4,700 on improvements in 2023, nearly 9 percent above the previous market boom in 2007.

  • The pandemic fueled unprecedented spending on remodeling.Home improvement and repair spending vaulted from $404 billion in 2019 to $611 billion in 2022, and is expected to remain above $600 billion through 2025. Homeowners remain focused on replacement projects such as roofing, windows, and HVAC, accounting for 49 percent of improvement expenditures in 2023. On average, homeowners spent almost $4,700 on improvements in 2023, nearly 9 percent above the previous market boom in 2007.
  • The housing stock is older than ever and substandard conditions must be addressed.With a median age of 44 years in 2023, the housing stock is older than ever, and critical improvements are needed to replace aging components. In 2023, average improvement spending for homes built before 1980 was 24 percent higher than spending on homes built since 2010, and maintenance spending was 76 percent higher. Many low-income homeowners live in housing with structural deficiencies or lacking basic features such as running water, electricity, or heat. “There is both a market opportunity and a moral imperative to expand improvement and repair services for these homeowners,” says Sophia Wedeen, a Senior Research Analyst at the Center. “More financing tools and counseling programs can also help preserve the affordable housing stock and ensure that all households live in safe and adequate housing.”
  • Changing demographics affect remodeling spending.The shifting characteristics of US households continue to reshape activity and spending patterns in the remodeling market. In 2023, owners age 65 and over contributed 27 percent of total improvement outlays, up from 14 percent two decades earlier. And as the population becomes more racially and ethnically diverse, households headed by a person of color contribute more to the home improvement market; in 2023, homeowners of color accounted for 23 percent of improvement expenditures, up from 14 percent in 2003. Immigrant owners also account for a growing share of the market, up from 8 percent of expenditures in 2003 to 13 percent in 2023.
  • Fragmentation, surging costs, and labor shortages hinder remodelers.Despite a flurry of mergers and acquisitions, the remodeling industry remains highly fragmented with large shares of self-employed contractors and small payroll companies. The industry is also hampered by high costs of building materials and labor shortages. Between 2015 and 2023, a majority of remodelers reported a shortage of skilled trade workers including carpenters, electricians, and plumbers. The industry also relies heavily on foreign-born laborers, with immigrants accounting for a record-breaking 34 percent of the construction trades labor force in 2023.
  • Material shortages and high costs remain.Even though annual growth in building material prices has largely slowed or even turned negative since 2022 as demand has cooled and bottlenecks have eased, the costs for many key materials are still appreciably above pre-pandemic levels. The price 
    of lumber and plywood was still 21 percent greater through the third quarter of 2024 than in 2019 despite declining on a year-over-year basis for almost two years.

In the near term, the remodeling industry faces both challenges and opportunities. On the one hand, elevated interest rates, weak home sales, and a persistent shortage of skilled trade labor are expected to constrain the market. At the same time, massive levels of home equity, a sustained shift toward working from home, and the aging of the housing stock will support significant investment in home improvement, perhaps most notably among owners who prioritize updating their existing homes over moving.  

“Given the strong foundation and growing needs, residential remodeling is expected to remain a formidable economic sector in the years ahead,” says Chris Herbert, managing director of the Center. “And despite unparalleled spending in the last few years, far more investment is needed to improve energy efficiency, disaster resilience, and accessibility for the nation’s 145 million homes.” 

To read the full report, visit jchs.harvard.edu.

https://www.woodworkingnetwork.com/news/woodworking-industry-news/remodeling-market-soars-faces-key-challenges

March 19, 2025

A Good Question

Do Household Appliances Really Not Last As Long As They Used To?

by Tyler Durden

Wednesday, Mar 19, 2025 – 06:25 PM

Authored by Ross Pomeroy via RealClearScience,

Everybody knows that household appliances don’t last as long as they used to. But is this conventional wisdom really true? Or is it just one of those alluring fables we like to tell ourselves about the good ol’ days?

Internet searches provide copious anecdotes. News outlets generally interview repair technicians, who tell a convincing and consistent story. Appliances built in the 1970s generally lasted thirty to fifty years, they say. Today, domestic mainstays like washing machines, ovens, fridges, and dryers get replaced about every decade. Technicians blame an industry push towards computerization, an increase in the number of individual components, and the use of flimsier materials like plastic and aluminum rather than steel. The results of these trends are appliances that break more often and are harder and more costly to repair.

But where is the hard data to back these tales? It’s surprisingly hard to come by.

Researchers Kamila Krych and Johan Berg Pettersen in the Department of Energy and Process Engineering at the Norwegian University of Science and Technology sought to fill the gap.

“We investigate how the sales and ownership of large household appliances have evolved since these appliances were introduced in Norwegian households, and we use this co-evolution to estimate the lifetimes,” they explained in their paper, published in January to the Journal of Industrial Ecology.

The duo estimated the lifetimes of fridges, freezers, washing machines, tumble dryers, dishwashers, and ovens owned in Norway between 1940 and 2022. Their analysis revealed the following trends and factoids:

  • Starting the 1990s, the lifetimes of fridges and freezers began slightly increasing, although the difference was not statistically significant.
  • In the 1990s, the lifetimes of dishwashers and tumble dryers started to decrease. But again, the difference was not significant.
  • In the 1990s and early 2000s, the lifetimes of washing machines and ovens fell off a cliff, respectively dropping from 19.2 to 10.6 years (–45%) and from 23.6 years to 14.3 years (–39%).
  • Older appliances lasted between 10 and 30 years.
  • Modern fridges, washing machines, dryers, ovens, and dishwashers operate between 10 and 15 years, while freezers last around 20.

“Our study suggests that the lifetimes of washing machines and ovens have decreased but provides no direct explanation for these changes,” they wrote. “The reasons for the identified lifetime decrease could be linked to technical, economic, or social factors or a combination of these.”

On the technical side, increasing reliance on electric parts, as well as added functionality and features, may have hindered longevity, they speculated. Economically, they noted that appliance-makers have striven to lower up-front prices for decades now. According to U.S. Labor Department statistics, home appliance prices declined 12% from the beginning of 2013 through the end of 2023. This race-to-the bottom may have eroded quality in the process, however.

There also might be something to the argument that new appliances are over-designed and harder to repair. On this front, the European Union has put in place “right-to-repair” rules that require manufacturers to produce replacement parts for at least ten years and design their machines to be fixable with everyday tools. While there’s no federal “right-to-repair” laws in the U.S., a handful of states have passed them.

Krych and Pettersen also raised a surprisingly simple explanation for the decline in washing machine lifespans: we use them more than we used to. 

“An average Norwegian family of four ran two washing cycles per week in 1960 but eight in 2000. This change in laundry habits is consistent with a general societal change in how cleanliness is perceived in Western countries. Given that the durability of washing machines is generally given as the number of cycles and that a change in laundry habits results in more cycles per year, we could expect more frequent replacements of washing machines.”

While Krych and Pettersen’s study may not be a perfect proxy for every developed market, it does at last bring empirical data to a well-trodden debate. Are household appliances less durable than they used to be? In some cases yes, in others no. But like a new washing machine with a gazillion wash options, sensors, and internet connectivity, the overall picture is complicated.

https://www.zerohedge.com/technology/do-household-appliances-really-not-last-long-they-used

March 19, 2025

European Update

European Polyether Polyol Prices Surge Amidst Supply Shortage

PUdaily | Updated: March 18, 2025

The European polyether polyol market has been facing noticeable supply chain pressure in recent months. Major European suppliers like Repsol and Dow are operating at low rates with reduced production levels, resulting in a relatively tight supply in the market. From February to March 2025, polyether polyol prices have surged by EUR 100/tonne due to the supply shortage. With a further widening supply gap and increased imports from China, European polyether polyol prices are anticipated to keep rising from March to April.

Additionally, there is a relatively small number of local traders in Europe, mainly due to the following reasons:

– Limited profit margins: Profits for polyols are relatively low, making large-scale trading markets unsustainable.

– High transport costs: Traders in Europe are feeling the strain of significant cost pressures.

In contrast, there are more traders in the Middle East and Africa regions, particularly in the African market, where large traders are not uncommon. Therefore, the focus of global polyether polyol trade is gradually shifting.

Shell’s Strategic Adjustment of Chemical Assets

Shell is considering selling its chemical assets in Europe and the U.S., with Morgan Stanley conducting a strategic review, according to a report from the Wall Street Journal. This move reflects the dual challenges facing the chemical industry. Uncertainty in regional markets: Shell owns multiple chemical complexes in Europe and the U.S., such as Rheinland in Germany, Moerdijk in the Netherlands, Mossmorran in the UK, Deer Park in Texas, Geismar and Norco in Louisiana, and Monaca in Pennsylvania. The operation of these facilities is affected by global market fluctuations and regional supply-demand dynamics. Particularly in Europe, amid the tight supply and continuous price increases of polyether polyols, the operational efficiency and profit margins of these assets are under severe tests. Margin pressure and strategic restructuring: Shell’s chemical business has been continuously incurring losses over the past three years, although the losses shrank in 2024 (reducing from USD 717 million to USD 392 million). As the European chemical industry faces significant pressure, strategic reviews and potential asset divestments have become important means for Shell to optimize resource allocation and reduce risks. Potential buyers include private equity and Middle Eastern companies who seek to expand capacity in the West. It reflects not only the market attention on chemical assets but also indicates potential shifts in the global chemical industry in the future.

Market Restructuring: Changes in Supply Chain Flows and Global Trade Patterns

By linking the current situation in the European polyether polyol market with Shell’s strategic adjustments, several underlying trends can be observed.

Supply Tightness Driving Price Increases

European producers are challenging to meet market demands due to the fragmented and relatively inefficient production models. Although Chinese products fill the supply gap, they also exacerbate the regional supply-demand imbalance. Consequently, price hikes become an inevitable trend. The continuously rising prices also prompt local producers to reevaluate their asset allocations and production strategies.

Cross-Regional Trade and Capital Restructuring

Global chemical giants like Shell are responding to losses and risks through strategic reviews and asset sales. In the future, if more companies choose to divest assets in Europe, it could lead to a round of capital restructuring and portfolio rebalancing.

Reallocation in the Global Supply Chain

With industry leaders like Shell increasing their investments in China and Singapore, the global polyol supply chain is gradually shifting its focus from Europe and the U.S. towards Asia. This trend not only underscores the reallocation of cost and production advantages but also is poised to have far-reaching implications on the future global trade landscape. Transport costs and trade barriers remain crucial variables in the polyether polyol market, potentially leading to more cross-regional collaborations and M&A restructuring in the future.

https://www.pudaily.com/Home/NewsDetails/54649

March 16, 2025

Container Rates Continue to Fall

Why Have Container Rates to Los Angeles Halved in 5 Weeks? Unveiling the Reasons

Why Have Container Rates to Los Angeles Halved in 5 Weeks? Unveiling the Reasons

Ocean Container Rates Plummet Amid Tariff Uncertainty

Table of Contents

LONDON,March 14,2025 – Spot ocean container rates are experiencing a significant decline,reflecting growing concerns about tariffs and evolving strategies among ocean carriers. According to recent data, rates have fallen 7% this week, reaching $2,368 per 40-foot container.

China-U.S. Rates See Sharpest Drops

The most considerable rate decreases are observed on routes from China to the United States.Specifically:

  • Shanghai to Los Angeles: Rates fell 8% to $2,906, marking a 46% decrease over the past five weeks.
  • Shanghai to New York: Rates decreased by 7% to $4,038,a 41% drop over the same period.

Why Are Rates Declining Despite Frontloading Efforts?

Despite widespread anticipation of frontloading to mitigate tariff impacts and increased import volumes reported in January, rates continue to fall. This seeming contradiction raises questions about the underlying factors driving the market.

Ocean Carrier Strategies

One potential explanation lies in the strategies employed by ocean carriers. According to Rachel Shames, vice president of pricing and procurement for customs broker CV International, “Ocean carriers have not controlled capacity by blanking sailings as aggressively as they otherwise would. This can be mostly attributed to a desire to have a smooth rollout of the new alliances and service strings, as well as an effort for the new alliances to maintain market share.”

Tariff Uncertainty

uncertainty surrounding tariffs is also contributing to market volatility. Shames notes, “Increasing tariffs and uncertainty are certainly a factor in the slower market.Spot rates on transpacific Eastbound lanes have fallen to levels not seen sence early in the Red Sea crisis. Outlooks are murky. Blank sailings are increasing for April, but whether it will be enough to drive rates up is unclear.”

Retailers Prepare for Potential Tariff Hikes

The National retail Federation (NRF) anticipates that retailers will increase imports in the coming months to get ahead of potential tariff increases.

Jonathan Gold, NRF vice president, explains, “The on-again, off-again tariffs against Canada and Mexico won’t have a direct impact on port volumes because most of those goods move by truck or rail. But new tariffs on goods from China that have already doubled from 10% to 20% are a concern, and also uncertainty over ‘reciprocal’ tariffs that could start in April. Retailers have been working on supply chain diversification,but that doesn’t happen overnight.”

However, the NRF projects a subsequent decline in import numbers for June and July, suggesting a potential correction after the initial surge.

Navigating the uncertain Waters of Global Trade

the current climate of declining ocean container rates and tariff uncertainty presents both challenges and opportunities for businesses involved in international trade. By staying informed about market trends,understanding carrier strategies,and proactively managing supply chains,companies can navigate these turbulent waters and position themselves for success. It is crucial to closely monitor developments in tariff policies and adjust sourcing strategies accordingly.

What steps are you taking to mitigate the impact of fluctuating ocean freight rates and potential tariffs on your business? Share your strategies in the comments below.

Based on the provided article, here is a possible PAA question:

Navigating Tariff Uncertainty: An Interview on Declining Ocean Container Rates

The recent drop in spot ocean container rates has sent ripples through the global trade market. With rates plummeting, especially on the crucial China-U.S. lanes, and uncertainty surrounding potential tariff hikes looming, we sat down with Emily Carter, Director of Global Logistics at Stellar Imports, to get an insider’s outlook.

Understanding the Decline in Ocean freight rates

Archyde: Emily, thanks for joining us. We’re seeing notable declines in ocean container rates, notably on routes like Shanghai to los Angeles. What’s your take on this, and how is Stellar Imports adapting?

emily Carter: Thanks for having me. The decline is definitely noticeable. While we anticipated a potential surge from frontloading ahead of any tariff implementations, the rates haven’t followed that pattern. We suspect it’s a combination of factors, including ocean carriers adjusting thier strategies and overall market hesitancy due to the tariff situation. At Stellar Imports, we’re actively negotiating rates and exploring alternative shipping options to mitigate the impact.

Carrier Strategies and Market Volatility

Archyde: Rachel Shames from CV International suggests that ocean carriers might not be aggressively blanking sailings. are you seeing evidence of this, and how does it affect your planning?

Emily Carter: Absolutely. We’ve observed less capacity management than we expected, and that’s playing a role in keeping rates down. This makes planning complex as while lower rates are beneficial in the short term, the long-term predictability suffers. We’re communicating closely with our carriers and diversifying our partnerships to hedge against potential disruptions.

Retailer Perspectives and Tariff Impact

Archyde: The National Retail federation anticipates increased imports in the short term, followed by a potential dip. How is Stellar Imports preparing for these projected fluctuations?

Emily Carter: We’re aligned with the NRF’s assessment.We’re working to optimize our inventory levels, strategically timing our shipments to balance immediate demand with potential future tariff implications. Supply chain diversification is also a key focus; we’re exploring alternative sourcing locations to reduce our reliance on specific regions.

Proactive supply Chain Management

Archyde: Tariff uncertainty is a major concern.What practical steps are you taking now to proactively manage your supply chain in this turbulent environment?

Emily Carter: Several things. First, we’re running simulations based on different tariff scenarios to understand the potential financial impact and adjust our pricing strategies accordingly. Second, we’re strengthening relationships with our customs brokers to ensure smooth clearances and minimize delays. we are exploring options of leveraging technology to enhance visibility across every node within our supply chain.

Navigating the Future of Ocean Freight

Archyde: Looking ahead, what is your biggest concern regarding ocean freight rates and global trade, and what advice would you give to other businesses navigating these uncertain waters?

Emily Carter: My biggest concern is the potential for sudden and unpredictable tariff changes, which can significantly disrupt supply chains and increase costs. My advice would be to stay informed, be flexible, and prioritize dialog with your carriers and suppliers. Don’t be afraid to explore alternative options and build resilience into your supply chain. Consider near-shoring that might provide a buffer for your supply chain. ultimately planning for the risk of continued trade instability is paramount.

Archyde: Thank you, Emily, for sharing your insights. It’s crucial to hear perspectives like yours during this time of market flux.

Why Have Container Rates to Los Angeles Halved in 5 Weeks? Unveiling the Reasons

February 24, 2025

Renovation Over Relocation

cons - redec or relo - feature image

Homeowners embrace renovation over relocation

Joanne Friedrick //Research Editor//February 24, 2025

DENVER — The “renovate over relocate” mentality is continuing among homeowners, with two-thirds saying they’d rather fix up their existing home than move to a new one during the current of climate of high interest rates and low housing inventory.

The 2024 State of Home Spending Report from Angi, a website and app that connects homeowners with service professionals, shows 93% of homeowners are planning to take on some projects this year.

“Homeowners are clearly committed to their homes,” said Angie Hicks, co-founder. “Even as economic pressures and challenges to getting projects done mount, the desire to create functional, personalized and well-maintained spaces is stronger than ever.”

Among the key projects on to-do lists are painting and design updates, cited by 22%; bathroom remodels (13%); flooring updates (12%); and landscaping (12%). Within the painting and design category, focus groups among professionals found homeowners opting for fewer colors and more monochromatic designs with varying finishes to create a modern look, while white-painted cabinets continue to be a popular means of refreshing a kitchen.

Bathroom fixture finishes trended toward black and gold, and laminate and luxury vinyl plank in lighter shades such as white oak replaced traditional carpeting.

Spending by generation was highest among Baby Boomers, who spent $14,140 in 2024. Millennials were the next highest spenders at $12,101, while Gen Z was lowest at just more than $9,500. High-income households spent nearly $22,000 on average, up from $20,649.

But overall, spending on home projects fell by 12% in 2024 to just more than $12,000 from $13,667 in 2023. About 60% of homeowners registered concern about being able to afford home maintenance and repairs this year.

The report found that more than half of homeowners (54%) are actively budgeting for projects in 2025. Younger generations are the most likely to do so; they also are more inclined to explore alternative financing options.

When it comes to long-range projects for the next five years, kitchen remodels are being considered by about one-third of homeowners, followed by bathroom remodels (28%), a new deck or porch (14%), updates to outdoor spaces (12%) and basement finishing (10%).

The State of Home Spending Report surveyed 6,691 individuals between Nov. 8 and 18, 2024, including those who had completed a remodeling project in the past 12 months using some hired help.

www.furnituretoday.com/research-and-analysis/homeowners-embrace-renovation-over-relocation/