Thursday, October 18, 2012

Home Remodeling Spending Set to Accelerate

by Abbe Will
Research Analyst
An improving housing market and record low interest rates are driving projections of strong gains in home improvement activity through the end of the year and into the first half of 2013, according to our latest Leading Indicator of Remodeling Activity (LIRA).  The LIRA suggests that the seeds for what appears to be a very robust remodeling recovery have been planted, with annual homeowner improvement spending expected to reach double-digit growth in the first half of 2013.

After a bump in home improvement activity during the mild winter, there was a bit of a pause this summer.  However, the LIRA is projecting an acceleration in market activity beginning this quarter, and strengthening as we move into the new year.  Strong growth in sales of existing homes and housing starts, coupled with historically low financing costs, have typically been associated with an upturn in home remodeling activity some months later.  While the housing market has faced some unique challenges in recent years, this combination is expected to produce a favorable outlook for home improvement spending over the coming months.  (Click chart to enlarge.)


For more information about the LIRA, including how it is calculated, visit the Joint Center website.
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6 comments:

  1. MartinOctober 23, 2012 at 12:50 PM

    The UK has followed a similar pattern, however due to the shortage of supply and high level of demand houses have been getting smaller, with less land. This makes them inflexible with a limited scope for altering the use.

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  2. Home ImprovementOctober 31, 2012 at 6:50 AM

    Makes sense that as the housing market starts to pick back up again and banks are willing to start lending again that home improvement trends will follow suit.
    -Jon

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  3. UnknownNovember 5, 2012 at 5:19 AM

    Nice post.The Leading Indicator of Remodeling Activity (LIRA) is designed to estimate national homeowner spending on improvements for the current quarter and subsequent three quarters. Remodeling Futures Program, initiated by the Joint Center for Housing Studies .

    Home Remodeling

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  4. Arizona Glass RepairNovember 8, 2012 at 7:03 PM

    Things are really heating up here in Phoenix as we head into our season. I hope this trend continues!

    ReplyDelete
  5. home remodeling northern VirginiaNovember 23, 2012 at 3:42 AM

    Good article on LIRA. Would you please tell me mor about it?

    ReplyDelete
  6. Federal Way PainterDecember 5, 2012 at 5:51 AM

    Yes, However, home remodeling is really costly, but if you pay for a home improvement and then enjoy it for ten to forty years, then all those costs will be worth it.

    ReplyDelete