Demand for builders' hardware (in inflation adjusted terms) in the United States will rise 2.1 percent per year through 2012, an improvement over the 1.2 percent annual gains of the period between 2002 and 2007, according to Builders' Hardware, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm. Gains in demand will be led by the recovery of the U.S. housing market, as housing completions rise from the low levels experienced by the industry in 2007. However, weak pricing, due to the decline of metal prices from the record highs experienced in 2008, and low-price imports will restrain value gains. Imports will account for nearly 42 percent of builders' hardware demand in 2012, up from 35 percent in 2007.

Among the various products, locks and other safety devices are forecast to account for the largest share of the builders' hardware market. In the residential market, the study concluded, continued homeowner interest in personal security will promote demand for locks in both the new construction and the improvement and repair segments. Electromechanical locks will offer some of the best growth opportunities, as property managers and homeowners opt for these items because of their perceived security benefits.

Furniture is projected to continue to account for the largest share of builders' hardware applications in 2012, with 37 percent of total demand, noted Freedonia in its research. Advances will be led by the popularity of home entertainment systems and home offices. Demand for hutches -- which have many drawers, storage areas and compartments -- for home entertainment systems, computer desks and workstations are expected to rise. This will in turn drive demand for such hardware as hinges, pulls, slides and furniture locks.

The residential market, which accounted for 55 percent of all builders' hardware demand in 2007, is projected to remain the leading market in 2012. As the U.S. housing market recovers from the contraction that began in 2006, demand for hardware will also rise, as more homes are completed and need doors, windows and furnishings. While new construction applications will continue to account for the larger share of builders' hardware demand through 2012, demand for hardware in improvement and repair applications is forecast to post more rapid growth, as homeowners and managers install improved locks and related equipment to upgrade structural security.

In a related study on the $8.6 billion US prefabricated housing industry, the Freedonia Group found U.S. demand for prefabricated housing would reach 185,000 units in 2011, despite projected declines in U.S. single-family housing starts. Manufactured housing will remain the dominant segment while shipments of precut homes will grow the fastest. The Midwest region will be the fastest growing market. The prefabricated housing study also considers market environment factors, details industry composition, evaluates company market share and profiles 30 leading players including Clayton Homes, Champion Homes, Fleetwood Enterprises, Palm Harbor Homes, Skyline, and Cavalier Homes.

[Note: The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually.]

Published: October 22, 2008

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Peter L. Mosca is president and founder of BAK Communications, Inc. He has over 22 years of communications and media consulting experience, serving a variety of nonprofit organizations, including the CCIM Institute and the REALTOR Association on all three levels – national, state and local. He is the Spokesperson Trainer for the CCIM's Jay Levine Academy and trains hundreds of residential REALTORS nationwide to be effective industry spokespeople. He is consistently ranked as "excellent" by about 90% of those who attend his presentations. While his principal consulting focuses are public speaking and media relations development and content delivery and management, Peter is also the host of the Voice America Network's weekly radio program, "Income Property Investment Talk," a one-hour program that brings the powerhouses of commercial and residential real estate to property investors every Wednesday at 11 a.m. EST. Peter is married 17 years to his wife Barbara. They have two children: Ashley, 15 and Kelli, 12. Hence, the name BAK Communications, Inc.