In the third quarter 2018, the industry continued on its gradual incline, said market analysis firm Metrostudy.
The PSN sister company released its latest quarterly New Pool Index (NPI), tallying the construction of new residential pools. This year’s figure represented an 8.4% increase over Q3 2017, and a 2% incline compared with the previous quarter this year.
The NPI works as a comparative figure, measuring pool construction against activity seen during the industry’s high point in 2005. It works similar to a percentage, with 2005 activity represented by 100. Numbers above and below 100 show the percentage comparison: An index of 120 would indicate activity that was 20% higher than in 2005; an 80 would mean it was 20% lower.
This quarter’s NPI was 49.7, showing activity that equaled 49.7% of that seen in 2005. Though small compared with the sales zenith, this figure also shows the 34th consecutive quarter of growth since the worst of the Great Recession, in 2009.
This also brings the industry on track to see overall annual growth of 7.5%.
However, the experts expect growth to slow down the next couple years — to 3.6% in 2019 and 0.6% in 2020 – before kicking back up in 2021. They attribute the expected moderation to an employment plateau and decreasing home sales resulting from rising mortgage rates.
“The industry will also need to keep an eye on rising construction costs,” said Metrostudy’s chief economist, Mark Boud. “Despite these challenges, we expect continued year-over-year gains in new pool activity during the medium-term.”
As part of its quarterly NPI report, Metrostudy also ranks the markets it analyses. Once again, nine of the top 10 markets reside in Florida. They are:
1. North Port-Sarasota-Bradenton, Fla.
2. Naples-Immokalee-Marco Island, Fla.
3. Tampa-St. Petersburg-Clearwater, Fla.
4. Panama City, Fla.
5. Deltona-Daytona Beach-Ormond Beach, Fla.
6. Pensacola-Ferry Pass-Brent, Fla.
7. Los Angeles-Long Beach-Anaheim, Calif.
8. Miami-Fort Lauderdale-West Palm Beach, Fla.
9. Orlando-Kissimmee-Sanford, Fla.
10. Palm Bay-Melbourne-Titusville, Fla.
Metrostudy analyzes several data points and key performance indicators to compute the index, including permit statistics, tax assessor information, home sales and unemployment rates.
