Article reprinted from Western Roofing magazine Sept/Oct 2007.

Residential Market

The Western Steep-Slope Market

by Marc Dodson, editor

It’s no secret that the residential market has slowed nationwide, and the West is no exception. True, many areas in the West are still going strong, but for most Western roofing contractors involved in steep-slope roofing, there’s very little, if any, backlog of work. Many contractors have switched their emphasis to low-slope roofing, where construction figures continue to slowly climb across the West.

The Western steep-slope market will take a smaller piece of the roofing pie this year, about 39%. This is a slight drop from last year’s 43%. That’s the opinion expressed by a number of sources, including industry experts, construction industry associations, financial institutions, and our own surveys. While the size of the Western low-slope roofing market is expected to continue its slow but steady growth pattern we’ve experienced over the last several years, the steep-slope market is expected to decrease slightly.

Despite these reports, our readers are still confident for a banner year. The results of our own survey sent to over 2,000 of our roofing contractor readers, of which 502 responded, feel that they will experience a 9.5% increase over last year. Most Western roofing contractors saw a steady growth in their business during the last few years, and expect that trend to continue during 2007.

2007 TOTAL Western Residential Roofing Market

Residential Mix

Where is all of the residential work going? While the major portion of the slowing trend involves single-family homes, work on multi-family residences is increasing as the baby boom population ages and moves to smaller upscale condos.

So have the insurance companies lightened up on multi-family dwellings? From the contractors we talked to, it doesn’t sound like it. The multi-family housing market continues to grow despite the increase in lawsuits and restrictions, or outright banning of work on multi-family dwellings by insurance companies. The demand is increasing in this area, but there are fewer contractors willing to do the work. Look for more Owner Controlled Insurance Programs (OCIP) to get more contractors back into the multi-family construction business.

2007 Residential Roofing Market Percentage of New Roof vs. Reroofing in 2007
	Reroofing 58% New Roofing 26% Repairs 16%

Reroofing & New Construction

As always, reroofing continues to dominate the Western roofing market with a predicted 58% of the total Western residential volume. Repairs and maintenance account for 16%, with the remaining 26% going to new construction. The new construction segment is down from 33% the previous year. The average for all roofing in the West, including commercial applications, is 61% reroofing, 13% for repairs and maintenance, and 27% new construction.

2007 Western Residential New Roofing Market

Product Mix

The most popular steep-slope roofing product installed in the West is, once again, fiberglass shingles, taking 49.8% of the market. This market percentage for fiberglass shingles is up slightly from last year.

Cement tile gained market share while clay tile was down slightly. Metal and slate gained market share in both reroofing and new construction. Other residential roofing products that are expected to see gains this year are copper shingles and modified bitumen.

2007 Western Residential ReRoofing Market

The Future

What’s going to happen to the Western steep-slope market in the future? Mortgage rates are still relatively low, but they’re climbing, and that single factor has put the brakes and many new home projects. Other financial indicators point to a continued slow rise in interest rates in the near future, then possibly a leveling out period. Many homeowners are staying where they are and repairing or remodeling their present homes.

Most experts seem to agree; the construction economy in the West should continue to grow, but the steep-slope market will slow for the immediate future. Some areas of the West seem unaffected and continue to grow. The only aspect of the Western construction economy they don’t agree on is, how long this trend will continue. •••