Once-Robust Remodeling Stabilizes

Apprehensive over the economy. homeowners continue to scale back on rcmodeling projects. according to a new report by Remodelormove.com.

Results show that aftcr a year of stcady declines in 2009. thc interest in remodeling stabilized in 2010. However, the size and scope of the remodcling proJects are much smaller when compared to 2007/2008.

For instance. small bathroom additions are the most popular. However, for those still planning to add a bathroom, the averagc size has decreased from more than 70 sq. ft. in 2008 to just 60 sq. ft. in 2010.

Beyond the bathroom. additional signs point to changes in the home improvement industry. They include:

Thc average number of rooms that homeowners plan to remodel f'ell fiom 3.1in2001to 2.7 in 2010.

Home equity increases in 2006 and 2007 encouraged spending. but now as equity shrinks. homeowners rrre scaling down their projccts.

. In the 2008 report, homeowncrs stated that their homes were worth an average of $390,000. with equity of $1,55.000. Today. thc average home value is just $289,000, with equity at $110,000.

About 85% said cost is the bigsest barrier to rcmodeling. Howcver. whilc thc scale and number of remodels is down. the intcrcst fiom homeowners who are in a position to rcmodel is strong, and thcir taste for hi-sher-end desi-ens and expensivc materials rernains.

Mrrre than l2o/o reporlcd that they plan to use cxpcnsive matcrials in their remodel; aln.rost 50% rcported that they are excited to start their remodeling project; and 84o/o plan to start in the next l2 months.

Colorado's lntermountain Battling Through Bankruptcy

Intermountain Resources, Montrose, Co.. ran at full capacity all summer, despitc bein-u placccl in reccivership in May.

"We have been ablc to acquire logs and convert them to lumbcr at a modest profit." srrid Pat D()r)(rvun. a prirrcipal at Cordes & Co.. which is overseeing the receivership and keeping thc mill afloat. "Wc are still dealing with the economic reality with the slowclown in thc housing market, decreased demand for fiaming lumber, and a decrease in prices," he said.

Bosed in Annopolis, MD, Fletcher Wood Solutionso is the lorgest monufocturer of defect-free, oppeoronce grode rodioto pine products in New Zeolond. Distributing our cleor boords, mouldings, LIFESPAN@ treoted wood, ond lumber io the North Americon morket through our proven ond completely integroted supply choin, Fletcher Wood Solutions@ mcintoins direct occess to one of the lorgest FSC ceriified'" pine plontotion forests in the world.

According to Donovan. most of the timber processecl at the mill comes from loggers who contract with the Forest Service to remove beetle-killed trees. He said that the company cannot honor its own ctlntracts u,ith the Forest Scn ice without losing mrtney.

"Thc majority of' those contracts can't be performcd bccause thc price of raw materials. the logs. is morc than what the rnill could al'lbrd to pay and convert to lumber and still makc a profit," said Donovan. "The Forest Service continues to send demands fbr payment under those contracts, which thc mill is not going to pay."

Intermountain is also facing bctween 200 and 300 unsecured crcditors who have not been paid. Donovan said that the best way to keep the mill alive in the future is to find a new owncr.

"The court has charged us with preserving and protecting iissets. and hopefully we can find a buyer for those assets at a number that we can repay the debts that have been incurrcd by Intermountain," he said.

By Mike Dandridge