Remodelers Today, Sellers Tomorrow
Boosted by rising home prices, homeowners are expected to spend more remodeling their homes this year than in any of the past 10 years.
Expenditures for home improvements are expected to grow from $140.9 billion last quarter to $154.8 billion by the end of September, according to a report recently released by the Remodeling Futures Program at the Joint Center for Housing Studies at Harvard University. Thats the highest level of expenditure since 2006 and marks an increase of 7.6 percent over last year’s figures.
Chris Herbert, managing director of the Joint Center, says that the continued recovery in the housing market is behind the increase in remodeling dollars, and that resale may be the biggest motivator. ”In most markets across the country, rising house prices are bringing more homes to the market and increasing sales, which is a large driver of home improvement activity,” he says.
In other words: Remodelers today, sellers tomorrow.
“The remodeling market has steadily improved in recent years with homeowners incorporating larger, more discretionary projects into their home improvement priorities,” says Abbe Will, a research analyst at the Joint Center.
The National Association of Home Builders’ Remodeling Market Index backs up the Joint Centers data: Remodelers are reporting a record-high level of confidence in the remodeling market based on the amount of work they are doing.
If the current projection of $154.8 billion pans out, it will beat the previously recorded high of nearly $150 billion in the second quarter of 2006. As the market tanked, so did remodeling, dropping below $120 billion from mid-2009 to mid-2013.
