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Sluggish housing market could add up to less remodeling business in 2020

Jim Buchta, Star Tribune (Minneapolis) on

Published in Business News

They broadened the scope in other ways, including new bathroom fixtures, reconfiguring the laundry room and installing up-to-date audio equipment.

"Not too much is being left the same," Bronson said.

The Bronsons wanted the job to be finished before they leave for warmer climes this fall, and they'd been burned on a previous remodeling project that took twice as long as expected. So they started interviewing three design-build firms in early January, hoping for a spring start.

"This wasn't my first rodeo," said Ray Bronson. "Scheduling was a big factor."

Their contractor, Ed Roskowinski, owner/general manager of Vujovich, said that since the recession, annual sales have been increasing about 5% to 10%, but he's expecting a shift.

"I look at 2020 as maybe a challenging year, he said. "I see the economy slowing a bit now, which will affect us in about six months."

 

Roskowinski agrees there's a correlation between demand for his services and home sales. So far this year, home sales in the Twin Cities haven't kept pace with 2018, mostly because of a shortage of listings that are affordable to first-time buyers and baby boomers. At the same time, the median price of those closings is at an all-time high, putting homeownership out of reach for a growing number of would-be buyers.

There's another factor for a possible slowdown, Roskowinski said. During election years, homeowners spend less on their home-improvement projects.

"Every four years you see a downtick (in sales) for about four months," he said. "A lot of our clients are tied to the stock market, so they're a little uncertain and will sit on their wallets and until the election is done."

That's not necessarily the case for much smaller companies that focus on more routine home maintenance and small remodeling projects. Mike Sitek, owner of Handyman Matters in Edina, said that in contrast to firms on larger projects, his company specializes in window and door replacements, deck repairs and other projects that can't be put off indefinitely, no matter the economy. He now has more work than he can handle and said the calls keep coming. It's now taking 30 to 45 days to bid a job,

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