Analyst Expects Best Flooring Sales Since 2006

New York, NY, Jan. 30, 2012 -- Flooring industry analyst Stifel Nicolaus expects 2012 to be the best year for flooring sales since 2006, helped by residential remodeling.

"We estimate total industry units will be up 2-4% and dollars up 5-7%. We are looking for the best year in flooring since 2006."

Stifel Nicolaus expects that new residential construction is will only add 1.1% to flooring sales this year.

The firm issued a report after attending the Surfaces trade show last week.

"Floor covering's limited exposure (approximately 8%) to new residential construction will likely see some gain with the continued acceleration of multi-family housing construction," the firm said.

The firm estimates that single family completions will rise 10.5% and multi-family will increase 59.5%. It said that single family units have approximately $2,900 per unit of floor covering versus $750 per unit for multi-family.

"Flooring sales to the new residential marketplace should increase 14% or approximately $196 million. While these figures are impressive on a percentage gain basis, it speaks to the current depressed level of housing construction that this 14% gain has only a 1.1% increase in total flooring sales."

Regarding residential replacement, the largest part of the market, Stifel Nicolaus expects a 3-5% increase in consumer/retail flooring demand this year. It sees higher consumer confidence, slowly rising incomes, and improving credit conditions as positives.

Stifel Nicolaus also expects the commercial market to be flat this year, weighed down by fewer government projects, offset somewhat by a fairly healthy hospitality market.