After enjoying strong growth the last several years continuing through much of 2006, the hardwood category has taken a downturn in recent months. Executives who spoke to FCNews for this annual hardwood flooring report saw 2006 closing at about a 3% increase over last year for various reasons, the main one of which was the second-half slowdown in the housing market.

While the market was relatively stable over the first three quarters of the year, noted Frank Ready, president and CEO of Armstrong Floor Products, North Amercia, “we have seen a noticeable decline in buyer activity, particularly in the new home construction segment. However, we continue to see commercial activity keeping pace with last year and strength at retail in some areas of the country. In addition, engineered products seem to be outpacing solid product sales again.

“The first half of 2006 was outstanding both in solids and engineered,” Ready said. “The second half has been much tougher given the slowdown of new construction.”

Don Finkell, president and CEO of Anderson Hardwood Floors, concurred. “We anticipated a 20% increase in 2006 over 2005, and the first quarter started off that way, but orders softened dramatically over the summer and we will finish the year about even with 2005. The housing bubble burst in areas where home prices had gone up the most over the last few years, so the decline in sales was really a decline in prices, which caused new home construction to slow dramatically along the coasts.”

David Wilkerson, Shaw’s vice president of marketing, hard surfaces division, said, “Our hardwood growth has been very strong. In fact, it’s the fastest growing part of our hard surface business.”