Home renovation sector, fuelled by COVID confines and government cash, on bust

·4 min read

Dermot Kearney's phone never seems to stop.

"Eighteen hours a day the phone goes, seven days a week. People requesting quotes, looking at work they want to get done," says Kearney, owner of Kildare Renovations in St. John's.

And it's the same hectic pace for Neil Dalton, owner of Dalton's Home Hardware in Cape Broyle.

"Compared to last year, the demand has doubled in certain categories of our business," said Dalton.

Bruce Tilley/CBC
Bruce Tilley/CBC

The home renovation sector — fuelled by COVID-confined consumers looking to spruce up their properties, and a $30-million rebate program from the Newfoundland and Labrador government — is on bust.

Contractors are being pushed to their limit to provide price quotes to homeowners hoping to benefit from a government rebate as high as $10,000.

"We've been inundated," said Kearney.

Bruce Tilley/CBC
Bruce Tilley/CBC

And retailers like Dalton can't seem to load their delivery trucks fast enough to keep up with the purchase orders.

"Every day we're just constantly running out of product, but we have it rolling in here every day, so, so far so good," said Dalton.

Kearney has doubled his workforce, and is still in need of help, while the nearly two dozen employees at Dalton's have been working overtime, preparing and delivering products to job sites all over the Avalon Peninsula.

"It's been one of the busiest years we've had," added Kearney.

Bruce Tilley/CBC
Bruce Tilley/CBC

In normal times, about a dozens tractor-trailers would arrive in Newfoundland and Labrador weekly to deliver everything from bathroom fixtures and seasonal items to the Home Hardware stores dotted across the province.

But Dalton said that number has doubled, and that does not include badly needed shipments of pressure-treated lumber and plywood.

"I think it's wonderful. It's great. The demand is strong," said Dalton.

While new-home construction continues to sputter, the opposite is true for the home renovation sector.

Bruce Tilley/CBC
Bruce Tilley/CBC

It's a welcome turnaround for a sector hit hard by a stumbling economy in recent years, with many contractors having to search for work, and construction specialists like carpenters and electricians forced to watch dust collect on their tools.

And when the global pandemic hit earlier this year, and modern society practically came to a standstill, few were able to predict what it would mean for their businesses.

Bruce Tilley/CBC
Bruce Tilley/CBC

But months later, for some, there's hardly any time between projects to think about quarantines.

With travel restrictions outside of Atlantic Canada still in place, and fears of catching the COVID-19 virus still top of mind for many, some homeowners who might otherwise spend money on vacations are redirecting that cash into their properties.

And if the extra time at home wasn't enough incentive, the provincial government fuelled the renovation fever in early June by announcing a $30-million residential construction rebate.

That's led to a run on lumber for decks and fences, with big retailers like Kent Home Improvement reporting a shortage of products like plywood and pressure-treated lumber.

"We appreciate the patience of our customers — homeowners and contractors — and are working hard to expedite deliveries of these products to our stores," a Kent spokesperson wrote in statement to CBC.

Bruce Tilley/CBC
Bruce Tilley/CBC

Those renovating their homes can be eligible for up to a 25 per cent rebate, to a maximum of $10,000.

The same maximum rebate is available for new home construction on homes valued up to $350,000.

The deadline to apply is Aug. 7, and the work must by done by a registered contractor by March 31, 2021.

The program is being administered by the N.L. chapter of the Canadian Home Builders' Association, and interest in the rebate is off the charts, said interim CEO Curtis Mercer.

Bruce Tilley/CBC
Bruce Tilley/CBC

The association's St. John's office is receiving some 150 applications each day, he said.

"It's a program that's doing what it's supposed to do; it's a stimulus," said Mercer.

And it's just the inspiration Brenda and Paul Andrews of Mount Pearl needed to pull the trigger on their home renovation project.

"Our house needs a facelift, and we're happy to take advantage of the 25 per cent rebate being offered by the government, so we're putting in our application today and crossing our fingers," said Brenda Andrews.

Not surprisingly, the hot market and shortage of some products is driving up prices.

A sheet of half-inch standard plywood, for example, that retailed for $28 at Dalton's Home Hardware a few months ago is now selling "in the high 30s," said Dalton.

Bruce Tilley/CBC
Bruce Tilley/CBC

Contractors are noticing the higher prices.

"Every day consumables that we used to just take off the shelf and pick up, it's all jumped up 10, 15 per cent," said Kearney.

"Most jobs will cost a little bit more than they would have a year ago, but again that's down to supply chain."

But with many workers still benefiting from a 75 per cent emergency wage subsidy from the federal government, Kearney said there's no reason for contractor labour rates to escalate.

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