Design and Construction Week, Las Vegas Jan 31-Feb 2, 2023

Like New York’s Time Square on New Year’s Eve, Design and Construction Week’s tenth anniversary event in Las Vegas this month attracted a sea of humanity from around the world. Two-hundred thousand people descended upon five big, contiguous trade shows which covered 1,000,000 square feet of exhibits. These five design and construction events include the International Builder’s Show, the Kitchen Bath Industry Show, the International Surfaces Event, the National Hardware Show and the Las Vegas Winter Market for furniture.

Show organizers called this year’s event it’s largest ever, with 70,000 IBS,40,000 KBIS, 17,000 NHS, 25,000 TISE and 50,000 LVM attendees who trolled through 1,800 exhibits. The “soft recession due to rising interest rates” housing industry-newsreel which sounded an alarm last year caused some large U.S. suppliers to cancel their exhibit booth space last fall. But these companies were replaced by international suppliers from Germany, Japan, Turkey, Canada Korea and China. I overheard many different foreign languages being spoken.

There was a dizzying array of education seminars on a wide range of topics, like, “How to Deliver Industry Leading Design at a Lower Cost;” “Single-Family Homes Built for Rent” (a growth market); and “Solving Supply Chain Challenges.” There were forecast conferences too, “Kitchen Trends: All the Bells and Whistles that Buyers Want in 2023;” “Trends, Forecasts and Key Indicators: What Custom Builders and Remodelers Need to Know;” and a “Multi-Family and Remodeling Outlook” session with National Association of Home Builder’s economists.

Of course, speculative home builders need predictions about home-buyer behavior in order to build what buyers want. High-touch custom-home builders and remodelers already know. Are pandemic behavior trends here to stay? Yes, home offices, media rooms, high tech homes, multi-cook’s kitchens, outdoor kitchens and entertainment areas will continue to ‘trend.” Parents! Don’t turn your kid’s bedroom into your hobby room yet. “Adult” children are here to stay, with us.

There was something of everything in these exhibit halls, 1,000,000 sq. ft. of product displays! I thought, “consumers are easily overwhelmed by the multiplicity of choices and decisions they must make, when custom building or remodeling. This is why the professionals they work with, be it a builder, architect, dealer or interior designer, are so important: to guide them through all that’s available, to help them curate and chose.”

At IBS there was an outdoor “Show Village” which presented modular housing, construction technique demonstrations and construction material exhibits, including Titebond adhesives and Quick House. Back indoors at the Kitchen and Bath Industry convention hall, Kohler stole the show with a toilet display in a bed of roses, a retrospective. I found a mint-green model called “Sunrise’” which was designed the year I was born. Over in the South Hall, a brisk ten-minute walk, the Hardware Show featured several products which were on my Christmas list, like snow blowers and woodchippers.

The Central Hall is for production home builders who value speed, labor efficiency and low maintenance materials above all else. There was a preponderance of plastic material, composite posing as wood.

Smaller custom-made material suppliers were more easily found in the outlying exhibit halls. I did find a wood repair and sealant exhibitor in the plastic pile: Abatron and sister company U. C. Coatings. In the south hall, Pioneer Millworks displayed reclaimed wood flooring. Brent Hull of Hull Millwork and his 100-Year (wood) Window was a celebrity speaker for the Build Show’s LIVE You Tube presentation.

Unico System informed custom builders about the space -saving and design- liberating virtues of their small duct, high velocity HVAC system. In an NAHB/ Wells Fargo Market Index Survey, October 2022, 76% of builder respondents said HVAC was in short supply. Appliances, Transformers, Windows and Doors were cited as even more hard to get.

Maybe because window supply lead times are so long, the big-brand window companies were absent from the IBS exhibit floor. A lesser-known Quaker Windows and Doors displayed the largest windows I’ve ever seen for residential application. Quaker’s Sr. VP of Sales, Chris Dickneite explained that these oversized windows were originally designed for commercial buildings but are now aimed at the luxury housing market, available with aluminum frames and wood interiors. Quaker’s exhibit touted their Opti Core technology which holds large energy efficient glass panels in ridged, thin-lined aluminum frames. Quaker has replica windows which pass muster for historic tax credit work.

In the press room I heard the NAHB economists tell me that 2021-2023 multi-family construction hasn’t been this strong since 1972. The MF market peaked with 545,000 units last year, most of it for rent. The high cost of single-family housing and still- short supply is pushing people of all ages to the rental market.

The median price of a single-family existing home is up to $366,900, according to the National Realtor’s Association. Prices on existing homes has gone up 130 consecutive months. NAR predicts that 4.7 million pre-owned homes will sell this year, down from 5.1 million in 2022. Here is how this breaks out by region:

The sales-rate of existing homes is a good barometer for future remodeling activity, especially since over 30% of existing homes are 50 years old or older.

For new single-family housing construction, the NAHB reports that the top five markets are in decline: Houston; Dallas; Phoenix; Atlanta and Austin. This is due to rising interest rates, from “3% to 6% which adds $700 per month to a typical home loan.” Last year finished with 999,000 new SF units built: this year 744,00 and in 2024, 925,000.

The custom home and remodeling markets are more buoyant than is production SF housing, driven largely by strong home equity and cash buyers. NAHB predicts a 5% increase in residential remodeling market growth in 2023.

The National Association of Home Builder’s party-line laments rising interest rates, a labor shortage, a production/speculative housing starts decline and the high cost of regulation. We may be in a “soft recession,” as NAHB calls it, but the 200,000 Design and Construction Week attendees: builders, architects, interior designers, kitchen/bath dealers, developers, tradespeople and material suppliers were upbeat, undaunted by the headwinds that face our housing industry.