As home values continue to rise, more home owners may find now is the best time to add to that value even more. Spending on home remodeling is expected to climb from 2.4 percent in the second quarter to 6.8 percent by the second quarter of 2016, according to Harvard University’s Joint Center for Housing Studies.
“Home improvement spending continues to benefit from the last years’ upswing in housing market conditions including new construction, price gains and sales,” says Chris Herbert, managing director of the Joint Center. “Strengthening housing market conditions are encouraging owners to invest in more discretionary home improvements, such as kitchen and bath remodeling and room additions, in addition to the necessary replacements of worn components such as roofing and siding.”
Sellers are already diving into more remodeling projects and using some of the equity in their homes to fund the projects. Black Knight Financial Services reported an increase in cash-out refinancing this summer – a 68 percent jump in the second quarter year-over-year, and it’s now at the highest level in five years.
Source: “New Kitchen? New Bathroom? Why the Time Is Now,” CNBC (Oct. 16, 2015)