As news of economic inflation continues to hammer businesses and project a looming recession, there’s one seemingly contradictory point of view: Now is a great time for homeowners to invest in a backyard swimming pool.
“In the next two years, the industry is going to change, and then supply and demand will change,” says Carla Barrera, director of business development & Elite program at Lyon Financial. “So once inflation goes down, demand will go up, and the price of a pool will go up.”
Swimming pool construction surged during and after the pandemic when homeowners discovered the value of the backyard lifestyle, causing the price of the pool to increase by 30 percent since 2021. The surge continued even after COVID, one that’s expected to increase by $6.7 billion over the next three years. The market is driven by three main factors: increasing demand for luxury lifestyle, growing interest in consumer recreational water activities, and growth in popularity for saltwater pools.
Still, it’s only natural for potential customers to be nervous at a time when interest rates and inflation are high. However, Barrera notes, “consumers are, more than ever, wanting to hold onto their liquidity, so they’re looking to finance their product. They can turn around and pay it off once the rates go down. In a year or two, they can refinance. A lot of people want to do that right now, because you never know what’s going to happen with the market, and with pool prices and materials.”
There are reasons financing can benefit customers and builders in an uncertain market.
1. Financing can help customers manage their budgets better and understand what they can actually afford. Some financing companies offer calculators for customers to see payment plans and charts. Others, such as Lyon, has an inquiry team that specializes in working with potential customers who are on the fence about financing. Builders simply refer those customers to Lyon who walk them through questions and processes, which can help reassure customers and close sales.
For builders, Barrera says it’s not only a great time to sell new pools, but to market towards existing customers for remodeling and upgrades. With home buying at a slower pace, more people are staying in their existing homes, and looking to remodel those homes and backyards – something she says is currently in a huge growth mode.
2. There will be improved financing tools available for builders in 2024, such as Lyon’s new contractor portal. This allows Lyon to provide live updates to its contractors and help builders drive their own funding, search customers, and receive notifications in real time. Tools like these will help strengthen partnerships between financial institutions and builders, aiding them with organization and navigating the sales process.
3. Securing a good financing strategy will also help homeowners feel more confident during these uncertain economic times. Loans that offer 30-year terms can help maintain budgets while lowering monthly payments, and customers can refinance when rates do go down. Having that in place with a financing partner already saves the customer the effort of shopping on their own and gives the builder a competitive edge.
For more information about how to offer financing to your customers, visit Lyon Financial.
