Remodeling recovery underway and picking up steam
All signs point to a strong rebound for home improvement activity in 2013, according to the Leading Indicator of Remodeling Activity (LIRA) released recently by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. Robust spending in the second half of 2012 suggests the remodeling recovery is already underway, and the LIRA projects annual homeowner improvement spending will see accelerating double-digit growth through the third quarter of 2013. This news comes just ahead of the release of the Joint Center’s biennial remodeling report, The U.S. Housing Stock: Ready for Renewal, scheduled for release next Wednesday, January 23 (embargoed copy to be released Tuesday, January 22).
“It’s encouraging to see the residential sector finally contribute to growth in our economy,” says Eric S. Belsky, managing director of the Joint Center. “Through the first three quarters of 2012, investment in the residential sector was responsible for one out of every six dollars added to our GDP. Moving forward, home improvement spending is expected to make an even larger contribution to GDP growth.”
“There are many external economic and political risks that could derail this remodeling recovery,” says Kermit Baker, director of the Remodeling Futures Program at the Joint Center. “However, the solid momentum behind home building activity, existing home sales, low financing costs, and remodeling contractor sentiment all point to a solid start to the new year for home improvement spending.”