View more The 2008 Top Performers
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View more The 2008 Top 500 List

Last year, the inevitable happened. After more than 15 years of sustained growth in the housing industry, a slowdown arrived and gradually became a market correction.

The slowdown was particularly pronounced for production home builders whose buyers exited the market. It was less clear how the market turn would impact the other two legs of housing, namely, remodeling and custom home building.

So how did remodeling fare in 2007?

By all conventional measures, remodeling did slow, and will likely contract more during 2008. Harvard’s Joint Center for Housing Studies’ new predictive measure of remodeling activity, the LIRA, (short for Leading Indicator of Remodeling Activity) suggests that remodeling retrenched during the fourth quarter of 2007 and indicates an annualized decrease of more than 8 percent this year. Yet, when you talk with established remodelers, like those who participated in this year’s Qualified Remodeler Top 500, and ask them about their businesses, most seem to be taking the slowdown in stride. The numbers speak for themselves.

In 2007, the aggregate dollar volume of the Top 500 remodelers surged to $4.86 billion, up from $4.13 billion in 2006. Aggregate gross revenues were just as dramatic, coming in at $5.04 billion, up from $4.39 billion the year before.

In reporting their “challenges” and “opportunities” on their applications for the list, the prevailing response from Top 500 remodelers this year was one of concern about the market and the economy. But rather than pull back, they seemed to use this concern as motivation to push forward. “We are seeing the same and even higher levels of business, but we’re working harder to generate qualified leads and close new business,” seemed to summarize the sentiment.

So did the slowdown simply not hit in time to have a major impact on 2007 remodeling revenues? Will the full impact only be felt in calendar ’08 numbers? Well, for the first time since this magazine began publishing its “Leaders” list 30 years ago, we asked for a forecast of remodeling dollar volume for the year ahead. The result: More than 70 percent expect to report higher remodeling revenue in 2008.