Home Remodeling Activity Looking to Gain Steam

Expenditures for home improvements should see healthy gains in 2016, according to the Leading Indicator of Remodeling Activity (LIRA) released today by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. The LIRA projects annual spending growth for home improvements will accelerate from 4.3% in the first quarter of 2016 to 7.6% in the third quarter. By then, the level of annual spending in nominal terms is anticipated to surpass the previous peak set in 2006.

2016 is looking to be a stronger year for home renovation activity compared to 2015 thanks to the continued recovery in the owner-occupied housing market. 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.

For more information about the LIRA, including how it is calculated, please visit the Joint Center for Housing Studies website.

Home Remodeling Surge Coming: Here’s Why

As the baby boomer generation ages, many home owners likely will choose to “age in place” and will require remodeling to better suit their changing needs.

“Since much of the housing stock is currently ill-equipped with even basic accessibility features, older home owners aging in place will need to invest in retrofitting their homes in order to age comfortably and safely,” writes Abbe Will, researcher analyst for JCHS.

“Yet the current housing stock is not especially equipped to meet the accessibility needs of an aging nation, as not even a third of homes have what could be considered basic accessibility features, such as a no-step entry and bedroom and full bathroom on the entry level,” JCHS’s analysis notes.

This suggests “the need for significant retrofit spending on existing homes to narrow this supply-demand gap,” the JCHS analysis notes. Meanwhile, “older households in the South and West regions of the country are already better accommodated for aging in place, with relatively more homes in these regions having basic accessibility features, and this trend is not expected to change over the coming decade.”

Source: “Aging Society and Inaccessible Housing Stock Suggest Growing Need for Remodeling,” Harvard University’s Joint Center for Housing Studies’ Housing Perspectives Blog (July 8, 2015)

Construction Spending “On The Rise”

The U.S. construction industry saw an increase in spending for the first time in four months — the biggest improvement since April 2010.

In March, construction spending grew 1.4 percent to $768.9 billion.

With an increase in home remodeling activity outpacing declines in apartments and single-family homes, residential construction expenditures rose 2.6 percent. Outlays for nonresidential projects, meanwhile, climbed 1.6 percent due to robust spending for hotel, office, and industrial construction.

Source: “U.S. Construction Spending Up,” Investor’s Business Daily (05/03/11) 

Other articles relating to the Sacramento and Placerville, California regions at: www.sierraproperties.com

Enhanced by Zemanta