This summer, Americans will be splashing around in their existing backyard pools but not spending much on new ones.
Installing swimming pools is part of a home improvement craze sweeping the country as Americans are stuck at home during the pandemic. But recent signs suggest demand is slowing as households spend money Shift it more toward the holidays Than decoration.
Poole Corporation., a national pool equipment distributor with a market value of about $11 billion, said last week New swimming pool construction is expected to fall by 15% to 20% This year. Some local contractors across the country are also experiencing contraction.
Skip Ast III, sales director for Shasta Pools in the Phoenix metro area, said the local industry has been struggling since around 2022.
“If 2023 isn’t already considered catastrophic, this year will be even worse,” he said, adding, however, that the company had successfully adapted.
And consumers no spending cuts Overall record spendingThose with extra money in their budgets are increasingly spending it on experiences such as travel, dining out and other hospitality purchases.
Airlines and hotels are Strong tourist season expected, Cruise Line Bookings Hit Record High, tickets for concerts and sporting events are still in hot demand at sky-high prices. In contrast, discretionary household purchases are cooling as food costs rise and the Federal Reserve keeps interest rates high to curb inflation, triggering long-term spikes in mortgage and credit card interest rates.
this Large-scale home purchases decline Months in the making, pools aren’t the only backyard amenity facing a slowdown in demand; Traeger’s Grill Reports first-quarter revenue decline, part of trend Started very early in the post-pandemic recovery. But businesses that rely on Americans’ demand for home upgrades are still adapting to the tough economic times, including pool builders.
A variety of pool installations in 2020, from in-ground pools and hot tub pools to the often less expensive inflatable pools and above-ground pools, up 20%According to real estate analytics firm Cape Analytics.
At that time, “people were starting to adapt to, ‘Okay, we’re going to be at home for a while, and we need to bring the holidays to our backyards,'” said Astor, whose family has been in the pool-building business for nearly 60 years. He recalled suppliers struggling to keep up with the flood of orders and contractors facing months-long backlogs.
Scott Payne, a pool installer in Hatfield, Pa., has also seen explosive growth in business during the pandemic: “As a company, our revenue doubled in five of the first seven years. He described answering eight to 10 calls a day during peak demand periods.
But despite recent price drops nationwide, Payne and Astor said their business is performing well, even though both companies have raised prices due to higher material costs. Both said their work during the pandemic laid the groundwork for dealing with the economic slowdown.
Payne’s company developed a “ubiquitous” presence there several years ago in response to growing demand in wealthy areas and is still profiting from it, he said. While he’s working on fewer projects now, the ones he’s working on are more expensive, allowing his business to keep revenue high.
“A lot of companies may have retrenched,” he said. “I can’t say we’re not seeing it, but we’re probably a little bit isolated. We’re still very, very busy.”
Astor said Shasta’s measures during the pandemic are paying off as demand cools. It launched an online calculator to help potential customers estimate the cost of their projects, and launched a new pool maintenance department to provide post-installation maintenance services. Astor said all of these factors combine to allow the company to capture a greater share of revenue from fewer consumers in the overall market.
Even Pool Corp. points to a silver lining in the slowdown: After many homes recently built new pools or upgraded existing pools, demand for the maintenance services Shasta now offers has increased.
“We are encouraged that sales of maintenance-related products have remained stable, as evidenced by growth in chemical sales, while equipment sales (excluding detergents) are down only 2% for the year, an improvement from the 3% decline in the first quarter. .
As climate change makes heatwaves earlier, hotter and more frequent — like those Most of the country was scorched in mid-June —Some consumers may begin to view swimming pools as a must-have.
In Arizona, Astor said, “in the desert, the lines between luxury and need get a little blurry.”
