According to the latest Palmer Market Research, an unexpectedly subdued home improvement sector has put a "dampener" on growth. In the previous 2014 report by the company on the domestic window, door and conservatory market, buoyant growth in the sector was predicted through to 2018, with the market for that year forecast to be 20% bigger than in 2013. However, 12 months on, the story is rather different. According to Robert Palmer, Director: "We are significantly less optimistic than we were last year. Overall for the sector, very sluggish performance is forecast over the period to 2019." In the recently published 2015 report, Palmer predicts that from an installed value of £4.12BN in 2014, the market will have grown less than 5% by 2019. Though the market did grow in 2014 by 4.5% in volume terms, if you focus in a little, three very different stories emerge. The glazing market in the new housing sector rocketed by 23%, as housing starts moved to their highest level since 2007, and the move to detached houses continued, with window installations growing to 1.37M units, the highest for 7 years. Over the next few years, a continued demand for new housing, offset by uncertainty around rising interest rates, planning delays and labour availability leads Palmer to predict continuing, but slowing growth in this sector. However, its in home improvements where things have stalled, and this is critical, since the sector represents nearly 80% of the total market. Palmer said: "In spite of a benign, improving economy, with strong GDP growth, glazing home improvements seem to have faltered." As to why that is, Palmer believes several factors such as: the slowdown in property transactions through 2014 and into the first part of 2015 (crucial since a significant percentage of home improvements are carried out soon after purchase); the current necessity of homeowners paying back debt rather than extracting equity; and the issue of saturation in the critical window replacement market, with over 91% of windows now replaced at least once, all contribute. The social housing sector actually did rather better than expected, with the first volume and value growth in window sales for nine years. That said, government cost-saving initiatives, from the end of the Decent Homes programme to the likely reintroduction of Right to Buy, means the outlook is far from rosy, with the market forecast to contract every year to 2019.
