The remodeling industry should expect to see “accelerated growth” by the end of the year and into 2013, according to the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. In their quarterly forecast, called the Leading Indicator of Remodeling Activity (LIRA), the researchers pointed to a pick-up in home sales and more positive business conditions for contractors. The LIRA suggests that annual homeowner improvement spending may reach double-digit growth by the first quarter of 2013.
“Home improvement activity has been bouncing around the bottom of this cycle for almost three years now, waiting for the industry to get some traction,” says Kermit Baker, director of the Remodeling Futures Program at the Joint Center. “Now, the combination of low financing costs, stronger consumer confidence, improving home sales, and the perception that home prices have stabilized in most markets across the country are encouraging owners to start working on the list of home improvement projects they have been putting off.”
Eric Belsky, managing director of the Joint Center, attributed a first-quarter bump in remodeling activity to warm weather in many areas. “By the end of the year, however, positive market fundamentals are expected to kick in, moving the industry out of this ebb and flow period and into a new growth phase,” Belsky added.