Homeowners are catching the home improvement bug again
UK homeowners are in the process of catching the home improvement bug again. With dramatic falls in mortgage approvals, an 8.3 per cent drop in property transactions and rises in stamp duty, all the signs are that homeowners will be staying put and improving their existing homes. If you want further evidence of this, you only have to turn to the latest data on remortgages. Twenty-one per cent of remortgages by borrowers are used to release funds to pay for home improvements. Translating this into real money, an analysis by estate agent LMS equated this to £1.2 billion being released in July purely for home improvements. Much of this money is being directed to trying to create more space and light for existing dwellings. A recent Savills report claimed a conservatory is ‘particularly appealing if attached to a kitchen’, adding over 5 per cent to the value of a property.
This represents a great backdrop for the fenestration sector to operate within. Over the summer months we have seen a number of major business deals which have led to change of ownership in a number of high-profile window businesses; the new owners of CWG Choices and Sash Fitrite have all spoken about the growing potential of the sector. With the latest market report from AMA Research also earmarking significant growth in the residential doors sector, along with the increased pressure on buy-to-let landlords to raise the energy efficiency of rental properties from April 2018 – there is great optimism about the future. We don’t want this opportunity to slip by and so it therefore becomes important to target growth. Picking the right strategy is key, a point perfectly highlighted by one of Europe’s major car manufacturers. Car sales are often identified as a useful parallel indicator to other large retail purchases such as home improvements, and for this reason Citroën’s British-born global Chief Executive’s turnaround strategy is of particular interest. Operating in a very competitive market, the company’s sales were faltering. In response, CEO Linda Jackson raised prices; in place of discounts she adopted monthly finance offers, and importantly she improved customer service by devising a simple menu for buyers. A buyer would start with just the car and then end up with all the extras plus insurance and servicing. The net result was a 15% increase in sales. The money is out there, you just need the right strategy to ensure you win profitable business.
John Cowie – Editor, Windows Active Magazine
