Will inflation slow down renovations? | The Press

Managers of platforms to find renovation contractors give us the prospects they see for 2023 regarding supply and demand in this environment. Even if the general momentum remains strong, changes are to be expected in light of the current economic context, and certain challenges will remain significant for both clients and professionals.

Based on the trend that began at the end of 2022, the Renovation Submission platform predicts that demand for small jobs, like that for large-scale construction sites, will continue to gradually run out of steam. In the first case, for the sake of economy, consumers seem to want to do the work themselves, when they are able to do so, according to the company.

“The slowdown in major work, such as home additions, is really related to interest rates, because it often involves mortgage refinancing. Having become more expensive, this work is postponed or shelved altogether,” explains Michel Jodoin, founding president of Soumission Rénovation, which has handled nearly half a million requests since its emergence in 2014.

According to its data, expansion, masonry, and landscaping projects saw declining demand between 2021 and 2022. For medium-sized jobs ($5,000 to $75,000), demand is expected to remain supported.

“But intentions to renovate remain very strong overall,” said Paul-André Bégin, chief operating officer of RénoAssistance, a platform that handled nearly half a billion dollars in work l year.

Deadlines?

Could this be the end of the tunnel for those who run after entrepreneurs, very courted and solicited in recent years? The picture is painted in shades of gray, Mr. Bégin making the distinction between things according to the fields. For the exterior renovation, he says, for example, not to observe greater availability. “But we see a perhaps greater appetite from contractors for certain types of work, in particular interior renovation, with a certain increase in their responses,” he specifies.

For his part, Mr. Jodoin notes that the level of competitiveness of bids, for January 2023, has returned to the pre-pandemic level, matching that of January 2020. “This means that contractors are more available. We receive a lot of requests from them to register with our service, their telephone rings much less than before,” he reports, hypothesizing that some of the professionals who were carrying out expansion work is focused on interior projects, such as kitchens and bathrooms.

No price drop in sight

More supply, less demand… can we count on the famous law governing these two factors to hope to see prices decrease? No, because other parameters come into play (inflation, I’m writing your name), and especially the labor shortage that continues to afflict the sector. “It is still there and will continue to exert pressure on prices, predicts Paul-André Bégin. With the increase in the price of gasoline, I think that, all in all, it will follow the course of inflation. »

The chief operating officer of RénoAssistance is therefore counting on a slight increase in renovation costs, even if the price of certain materials tends to fall, such as that of lumber – which could favor mini-construction sites carried out by oneself. -even. Ditto on the side of Submission Renovation, which does not foresee a deflation of invoices, but rather reduced availability times.

In short, hammers and drills will certainly not remain silent in 2023, but could operate a small migration of project types. “A lot of people have changed ownership in the last two years. However, statistics show that renovation projects of a certain size are still planned after two years of acquisition. People want to renovate,” believes Mr. Bégin.