Owners Tackle More Remodels as Equity Rises
July 20, 2017
Spending on repairs and home improvement continues to grow at a stable rate as homeowners feel more confident about starting projects as their home values increase.
That said, an annual increase in remodeling expenditures may soften somewhat in the coming months, but will likely remain at or above 6 percent through the second quarter of 2018, according to the latest Leading Indicator of Remodeling Activity from Harvard University’s Joint Center for Housing Studies.
“The remodeling market continues to benefit from a stronger housing market and, in particular, solid gains in house prices, which are encouraging owners to make larger investments in their homes,” says Chris Herbert, managing director of the Joint Center for Housing Studies. “Yet, weak gains in home sales activity due to tight inventories in many parts of the country is constraining opportunities for more robust remodeling growth given that significant investments often occur around the time of sale.”
Despite some projected easing this year, the remodeling market will overall continue to increase above its long-term average, says Abbe Will, research associate in the Remodeling Futures Program at JCHS.
“Over the coming 12 months, national spending on improvements and repairs to the owner-occupied housing stock is projected to reach fully $324 billion,” Will says.
Source: “Steady Gains in Remodeling Activity Moving Into 2018,” Harvard University’s Joint Center for Housing Studies (July 20, 2017)
Updated: July 19, 2018