One – on – One… with Don Novak, Chairman NAHB Remodelers Council
 
July 1st, 2005

 

July-August 2005

By Jeffrey Steele

The remodeling business is on track to surpass new home construction in the next ten years. Here’s what one remodeler—with his hand on the industry pulse—has to say about how tile fits into this growth.

Don Novak knows a thing or two about remodeling, and has the credentials to prove it. Novak is a Certified Graduate Remodeler, Certified Aging-in-Place Specialist, Certified Graduate Builder, Certified Kitchen Designer, Certified Master Carpenter and Certified Pella Contractor.

In addition, Novak heads his own Cedar Rapids, Iowa-based remodeling firm, Novak Construction Company, and is this year’s national chairman of the Washington, D.C.-based National Association of Home Builders’ Remodelers Council.

Novak recently sat down with TileDealer to discuss the size of the remodeling marketplace, the importance of kitchen and bathroom remodeling, the ways today’s remodelers are learning from the past and how remodelers are using ceramic tile in their projects.

TileDealer: How big is the remodeling marketplace?

Novak: Let me put it this way. There are about 700,000 remodelers, of which 70,000 have employees and are big enough to handle payroll. Some $235 billion will be spent on remodeling this year, compared with $225 billion last year, in the United States . We’re going up about 15 percent a year. That’s compared with about $250 billion on new home construction.

Remodeling is kind of on track to surpass new home construction within this decade, or at least within 10 years. There are a number of reasons why.

Number one, there’s just a bigger inventory of homes out there. Every 20 to 25 years, they need roofs, or need modifications to fit changing lifestyles. In addition, there are a lot of areas in this country where governmental bodies are restricting [new residential construction] to zero growth. So the only way for people to increase the value and livability of their homes is to remodel. New things come along, and people like to have them. And that drives what we do.

TileDealer: How important is kitchen and bath remodeling?

Novak: Remodeling Magazine in one of their issues from last fall basically interviewed somewhere around three to five realtors in about 60 different markets around the country. They asked them what projects people can do that will recoup the most on their investments if they turn around and sell their homes within one year. It seems to vary from year to year, but kitchens and baths always seem to come in close to the top. With a minor kitchen remodel, they say that they can recoup 93.1 percent of their investment. [In this issue], they’re rating total kitchen remodels at about 80.3 percent. Usually kitchen remodels are up a little higher than that.

Minor kitchen remodeling, like replacing a countertop and changing appliances, gives you a quicker return than if you go in and tear out all the cabinets and basically replace everything. That includes replacing cabinets, countertops, appliances and putting in new tile floors with heating elements so the tile is nice and warm. They have a bathroom addition that recoups about 90.5 percent of the investment, and a bathroom remodel will recoup about 90.1 percent.

Kitchen and bathroom remodeling are among the best at recouping investment, but they’re also among the most expensive. For an upscale major kitchen remodel, you’re talking about around $75,000 as a nationwide average. With a minor kitchen remodel you’re looking at about $15,240. That includes refinishing existing cabinets, putting in laminate countertops and replacing oven and cooktop, sink and faucet, replacing the floor and doing some repainting.

TileDealer: What kinds of other upgrades are homeowners doing?

Novak: Sometimes they’re doing attics. Basement refinishes offer a return on investment of about 75.6-percent. That’s something we do quite a bit here in the Midwest .

A sunroom addition offers about a 72.1 percent return on investment. We also do window replacements, roof replacements. People are adding decks, replacing siding.

We’re not seeing as many room additions as we used to. I don’t know why—it may be the economy. It seems personally speaking, we used to run about 10 to 12 room additions a year, and now we’re down to two or three. But we’re also seeing major house remodels, where we’re going in and doing everything. We get one or two of those every year.

TileDealer: How is ceramic tile being used to differentiate better projects from typical remodeling projects?

Novak: We’re seeing a lot more tile going in homes than we did in the past. We went through a period where there were a lot of fiberglass or acrylic tub and shower modules being put in. Now we’re seeing a lot of those being supplanted by tile on the walls of the tub and shower.

We’re seeing a lot more tile going in on floors, particularly in kitchens. The idea of putting in electric heat cables on top of the ½-,3/8- and even ¼-inch concrete Durrock sheets, then putting a cement coat over the cables before putting in the tile, is very popular. This is a great idea for bathrooms as well. And we just finished a basement remodel where we actually put electric cables underneath a big family and living room within the basement. We also did it in their exercise area too. We did the majority of the basement this way.

We’ve been using tile around fireplaces and hearths for a long time for decoration. We’re seeing it going on countertops. We just finished a big kitchen remodel where they had granite countertops, and we used white 4-¼- by 4-¼-inch tile for the backsplash, running from the countertop up to the bottom of the upper cabinets. That was interspersed with other white tile with decorative patterns. We’re seeing some tile that really looks nice in decorative settings.

There’s a lot of different things out there right now. It depends on the [project], but some of the floors we’re putting in, we’re using tile as big as 16-inch square. We’re seeing a lot more porcelain tile, and we’re seeing some of the stone tiles as well. They actually have some that look like stone but you can use it without grout lines and it makes it look more like a continuous floor.

We’re seeing a lot of people in the Midwest stay with the basics. In the kitchen and bath, they’re going toward lighter colors and more of a natural stone look.

TileDealer: Are you using tile in swimming pool jobs? Novak: We’ve done several enclosed swimming pools and have used tile in those locations, where we’ve basically used them on the entire surface adjacent to the pool so it’s impervious to water. It’s basically the walking surface around the pool, which makes it easier to take care of. And when you incorporate some of the heat cables in that walking surface, it makes it really nice.

TileDealer: How has kitchen and bath remodeling changed over time?

Novak: One of the biggest things we’ve seen in recent years is the use of granite countertops. They tend to be very popular, and I would think they’d be popular for years to come.

Speaking from a tile standpoint, we’re seeing an awful lot of products being used now. When I started out in the 1950s and early 1960s, there weren’t as many choices in tile. Most of them seemed to be a plaster-type tile with a glaze over them.

Now we’re seeing so many different things out there: the natural stone, bigger tile than what we used to see, even 16-by-16, 18-by-18 and 24-by-24. Porcelain tile, which wasn’t that popular back a few years ago has now become kind of the normal thing people are doing. There’s just been a lot of improvements in products, and the way we install products.

In homes built before World War II, through the 1930s and early 1940s, they would cut the floor joist down and recess the sub-floor so they would have room for an inch and a half or two inches of concrete. This was to give a good base to the floor tile.

Those floors are still looking as nice as they did when they were put in.

It’s the same with the walls. Instead of putting tile over sheetrock or just regular plaster, they would actually leave the plaster off and would put wire lath over the studs. And then they would trowel cement over that to get a good base for the tile.

Those products have lasted. A lot of those today look as good as when they [were] put in.

After World War II, everybody started taking short cuts. They’d install the floor tile over plywood or over a masonite underlay. And then on the walls, they would just put tile right over the sheetrock. Now a lot of those products are just literally falling apart. That’s why we’re putting in this Durrock, or cement board, and in some places they’re going back to doing a cement build up over wire lath. With this procedure, the product doesn’t rot away from the back the way it did with sheetrock, so it’s more durable. It will last a whole lot longer. It’s strange how we try to take shortcuts, then have to go back to square one where we were years ago.

We’re also putting in shower seats. Durrock works fine on straight walls, but when we put it in a shower seat situation, we have to trowel back over the joints so we don’t get leakage in them. Water’s falling right on it and it’s a good place for a leak if it’s not installed properly.

Shower bases have changed also. It used to be that years ago they put in a lead pan with sides that came up four to six inches and they would pour cement in the bottom of that for the base of the shower and then tile over that. But we found out that the lead after a while starts deteriorating. So now we’ve gone to fiberglass mesh, and they use some resins that prevent deterioration from moisture. They cement over that, then put the tile down on top of the cement. It’s kind of building a fiberglass module in place.

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