Who Influences the Purchasing of Building Products?

2025-04-21T08:18:04-05:00

In a previous post, NAHB analyzed where builders and remodelers purchased products, regardless of who ultimately purchases them (themselves or subcontractors).  In this post, the question shifts to who is most often responsible for  the choice of particular products. When averaging over all 24 building product categories, 60% of builders report they had the most influence on product selection compared to 49% of remodelers.  Still, these shares are ranked the highest within their respective sector.  Both builders and remodelers reported similar shares of influence for subcontractors, dealers & suppliers, and architects.  However, when it comes to the greatest influencer being the customer, this is more prevalent among remodelers (26%) than among builders (16%).  When analyzing the top seven products most often chosen by the customer, there is a considerable gap between remodelers and builders.  Most of these products (cabinets, lighting, carpeting, ceramic tile, countertops, other flooring) typically are chosen for decorative qualities which are rated quite important among customers. Please click here to be redirected to the full report. Discover more from Eye On Housing Subscribe to get the latest posts sent to your email.

Who Influences the Purchasing of Building Products?2025-04-21T08:18:04-05:00

Where Do Builders and Remodelers Buy Building Products?

2025-04-14T08:19:20-05:00

The most common sources for products used in home building and remodeling are specialty retailers, lumber yards, and wholesale distributors, according to two recent NAHB surveys. The surveys include one of single-family homebuilders in the October 2024 NAHB/Wells Fargo Housing Market Index (HMI) and one of remodelers in the Q3 2024 NAHB/Westlake Royal Remodeling Market Index (RMI). Both surveys asked respondents where they purchase building products, regardless of who ultimately purchases them (themselves or subcontractors) When averaging across 24 building product categories, the top three major channels of distribution are roughly the same for both builders and remodelers. Specialty retailers, lumber yards, and wholesale distributors together account for around 70% of building product purchases. When analyzing the specific products purchased at lumber yards, the top products purchased by both builders and remodelers were basic lumber products including plywood & OSB, sawn lumber, and engineered lumber & I-joists. One major difference between builders and remodelers was the share of those who purchase products from home improvement centers.  Remodelers are three times as likely to buy products at this channel of distribution compared to builders.  Nevertheless, one specific product category, hand & power tools, is purchased at home improvement centers by a majority of both remodelers (68%) and builders (56%).  Of those that do purchase hand & power tools at home improvement centers, 11% of remodelers purchased at least one other product there compared to 3% of builders.  A subsequent post on who is most often responsible for choosing these products will come later. Please click here to be redirected to the full report. Discover more from Eye On Housing Subscribe to get the latest posts sent to your email.

Where Do Builders and Remodelers Buy Building Products?2025-04-14T08:19:20-05:00

Builders’ Top Challenges for 2025

2025-02-06T09:19:00-06:00

The most significant challenge builders faced in 2024 was high interest rates, as reported by 91% of builders in the latest NAHB/Wells Fargo Housing Market Index survey.  A smaller, albeit still significant share of 78% expect interest rates to remain a problem in 2025. The next four most serious issues builders faced in 2024 were rising inflation in the U.S. economy (80%), buyers expecting prices/interest rates to decline (77%), the cost/availability of developed lots (63%), and the cost/availability of labor (61%).  Builders don’t expect much improvement in these challenges in 2025, except for rising inflation, which ‘only’ 52% see as a serious problem in the year ahead. In addition to those top tier challenges, 55% to 60% of builders also reported facing serious problems in 2024 with gridlock/uncertainty in Washington (60%), building material prices (57%), concern about employment/economic situation (55%), impact/hook-up/inspection and other fees (55%), and negative media reports making buyers cautious (55%). Looking ahead at 2025, significantly fewer builders expect gridlock/uncertainty in Washington (32%) or have concerns about the employment/economic situation (39%).  In contrast, more builders are expecting building material prices to be a problem in 2025 (64%) and about the same expect continuing problems with impact and other fees (58%). Builders have been asked about their most serious challenges every year since 2011. High interest rates have been a problem for a negligible share of builders (under 10%) during most years, except for 2022 (66%), 2023 (90%), and 2024 (91%).  When first introduced to the survey in 2021, 63% of builders reported challenges with rising inflation in the U.S. economy, but the share grew to at least 80% in 2022, 2023, and 2024. Prior to 2022, relatively few builders reported problems with buyers expecting prices or interest rates to fall, but that share rose to 49% in 2022, 71% in 2023, and 77% in 2024. The cost/availability of developed lots has been a serious challenge to most builders in nine of the 14 years of the series history. In 2022, 51% of builders faced this problem; by 2024, 63% did—tying a record high set in 2019. Meanwhile, more than half of builders have reported the cost/availability of labor as a serious problem for the past 11 years in a row. While 82% and 85% of builders faced this challenge in 2021 and 2022, respectively, the share has eased to 73% in 2023 and to 61% in 2024. For additional details, including a complete history for each reported and expected problem listed in the survey, please consult the full survey report. Discover more from Eye On Housing Subscribe to get the latest posts sent to your email.

Builders’ Top Challenges for 20252025-02-06T09:19:00-06:00
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