HBS Update With Simon Baker
9 Aug 2023
A mid-year look into the challenges, opportunities and responsibilities of the spray foam industry
More than halfway through 2023, our industry, like the overall economy, is facing some challenges. Though now slowing, inflation and interest rates both remain elevated and we are feeling the pinch. Recent high-profile bank failures, along with the current volume of commercial real estate loans on bank balance sheets, have restricted lending and slowed new construction activity of commercial properties.
Residential real estate tells a bit of a different story. While higher interest rates have meaningfully increased the cost of homes for buyers, pent-up demand and a low inventory of resale homes have benefited homebuilders during the first half of the year. Spring selling season was healthy and many of the country’s top builders have done well. New residential construction thus remains an opportunity for the spray foam industry, as do specific commercial property types not as impacted by economic conditions. These include industrial properties, institutional facilities such as schools, prisons and hospitals, as well some types of hotels.
Another opportunity for spray foam contractors and their customers today is the Inflation Reduction Act (IRA). Signed into law last year, the IRA helps fund energy efficiency advancements within the nation’s building stock. Several provisions within the IRA provide funding for spray foam insulation including the 25C Tax Credit, giving homeowners up to $1,200 for retrofitting their home with energy efficiency improvements, like spray foam insulation; 45L which gives homebuilders up to $5,000 per home (or $1,000 per multifamily unit) built to meet certain energy efficiency standards; along with two additional rebates given to homeowners who improve the energy efficiency of their home. Contractors are encouraged to take advantage of this opportunity and help educate their customers about IRA benefits. We have assembled resources to help contractors here: https://www.sprayfoamtaxcredit.com/ira.
Amidst the varying market dynamics and opportunities, the performance and benefits of spray polyurethane foam continue to shine. However, it is more imperative than ever that our industry prioritizes contractor safety and training. Being a professional installer of the product requires education, skill and training. That’s why we at Huntsman Building Solutions are so committed to providing ongoing, robust education and technical support to our network of contractors. We are proud to reveal that today, more than 2,000 in the industry have signed up to participate in our HBS University training program and we lead the largest field-based technical team in all of North America. We encourage all those interested to become HBS-approved contractors and to train with us.
It is all part of our continued focus on Safely and Ethically Creating Value. From recycling tons of plastic water bottle waste and converting it into energy-saving spray foam to educating and supporting today’s contractors to help ensure safe, effective installation and product performance, Huntsman Building Solutions is committed to excellence.