Residential remodeling may be a $100-billion industry in the United States this year, but it's done locally, in increments of about $10,000 to $100,000, one job at a time.
That's one message from a seminar on marketing to the remodeling industry held recently in the remodeled Hollywood Roosevelt Hotel under the auspices of Reeds Farris & Lewis, a Los Angeles marketing concern.
The location of the seminar makes sense: Last year Los Angeles was the nation's top remodeling market, with construction dollar volume of $611 million, according to Remodeling magazine. That's almost three times the $217 million of second-place Washington, D.C.
Talk about growth! The national remodeling market doubled from about $45 billion in 1982 to more than $92 billion last year, according to the Remodeling report.
Perhaps the most important factor fueling this growth, the study points out, is the aging of the nation's housing stock. In 1983, there were nearly 68 million houses that were 14 years old or older. The Census Bureau uses this age as a guideline, because the roof, plumbing, electrical systems, kitchen appliances and mechanical equipment wear out regularly in fairly predictable cycles.
The study, "The State of the Remodeling Industry and the Role of the Professional Remodeler," was prepared by the publishers of Remodeling magazine, Hanley-Wood Inc., 655 15th St., N.W., Suite 475, Washington, D.C. 20005.
Seminar participant Jim Rice of Forest Construction Co., Camarillo, heads a company started by his father in 1949. He has 25 to 30 full-time employees, an in-house design department and gets most of his work through referrals from customers. His firm does everything from custom homes--he's building one in Malibu for entertainment entrepreneur Dick Clark--to room additions, gazebos and new kitchens and baths.
"Our jobs range in cost from about $5,000 to more than $100,000 and reflect changes in life styles," Rice said. "Kitchens are very important to our customers and tend to be traditional in design in Ventura County; not as high-tech as parts of Los Angeles where European cabinets are so popular."
Another participant, Jim Dieckmeyer of Dieckmeyer Enterprises, Upland, said that building industry trade groups affiliated with the National Assn. of Home Builders are at last treating remodelers with the respect they deserve.
Dieckmeyer was elected president of the Remodelors Council of the Building Industry Assn. of Southern California last year and is a director of the National Assn. of Home Builders, with which the BIA is affiliated.
There are forces impacting remodeling for good and for ill in California: The $1.50-per-square-foot school fee that went into effect last Jan. 1 is making many marginal prospects think twice about adding space, he said.
On the plus side, it costs $20,000 to $25,000 for the owner of a $100,000 house to move, so remodeling jobs in that range are often very practical, Dieckmeyer said.
"So much depends on the individual situation," he added. "A master bedroom room addition at $10,000 might be all that the client needs to make the house right. On the other hand, it might be cheaper for the family to move if they're not happy with the neighborhood and the size or floor plan of the house."
Todd Russell, owner of T.A. Russell Construction, Glendora, does room additions and remodeling in the San Gabriel Valley. Typical jobs run between $30,000 to $50,000 and 95% of his business is by referrals.
"There are a lot of 40-year-old houses in Arcadia and Glendora--to name two communities where I do a lot of work--that need new kitchens and baths and rearranged floor plans," Russell said.
He does all the carpentry and uses subcontractors for virtually everything else.
Speaking of seminars, for $49 you can hear appraisers, mortgage bankers, realtors and other specialists discuss home improvement topics at a 7:30 p.m. Wednesday session at the Marriott Hotel at 5855 W. Century Blvd., near Los Angeles International Airport. The program will be repeated at 7:30 p.m. Oct. 8 at the Valley Hilton, 15433 Ventura Blvd., Sherman Oaks. The sessions are sponsored by the National Assn. of Real Estate Appraisers, Scottsdale, Ariz.