Harvard Study: Remodel Activity to Pick Up by Year’s End
The healthy gains in residential remodeling activity estimated for 2014 and the first part of this year are expected to decelerate, but then gain a little more traction by the end of the year, according to the Leading Indicator of Remodeling Activity (LIRA) released by the Remodeling Futures Program at the Joint Center for Housing Studies (JCHS) of Harvard University.
The LIRA report predicts remodeling activity for 2015 will increase 2.9% over 2014, with total homeowner improvements estimated at $147.4 billion.
“One of the largest contributors to this dampening of remodeling growth in 2015 is the sluggish existing home sales activity last year,” said Chris Herbert, JCHS' managing director. “Housing turnover typically sparks significant improvement spending as new owners customize their recent purchases to fit their needs and, with sales down last year, remodeling will feel the effects this year.”
Abbe Will, a research analyst in the Remodeling Futures Program at JCHS added, “Moving forward, signs of higher growth in remodeling activity include strengthening retail sales of building materials. Also, rising home equity and still favorable interest rates continue to encourage owners to reinvest in their homes.”
For more information, visit jchs.harvard.edu.