Metrostudy’s New Pool Index (NPI) for the fourth quarter of 2018 depicted activity that continues to gradually rise.
The NPI showed a 7.8% year-over-year increase to 50.5 in Q4. It also represented a 1.6% rise from Q3 2018.
Here’s how the NPI works: It is a comparative figure that measures 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.
So last year’s Q4 NPI of 50.5 represents approximately 50% of the new-pool activity highs seen in 2005.
Metrostudy said this was the 34th consecutive quarter of growth since the economy bottomed out in 2009. The analysts expect this to continue for the next few years, but believe growth will slow down to an average of 4.2% this year and 0.9% in 2020.
“New-pool construction continues to be fueled by strong job growth and all-time high levels of home equity,” said Metrostudy Chief Economist Mark Boud. “By most accounts, pool builders remain busy heading into 2019, with only a few whispers of projects expecting to slow a bit.
“While we expect continued gains in the New Pool Index over the next several years, growth will likely moderate as the economic and housing cycles mature. The renovation, repair, and maintenance segment will remain a bright spot within the industry over the forecast, as rising mortgage rates will persuade more people to stay in their current homes and renovate their aging pools.”
