Outlook volatile for home improvement spending
After showing signs of recovery, spending on home improvements is expected to remain volatile and weak over the next several quarters, according to a report released today by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. The Leading Indicator of Remodeling Activity (LIRA) projected that annual remodeling spending through the first quarter of 2012 will be down 4%. The Census Bureau’s improvements spending series, to which the LIRA is benchmarked, was recently revised downwards as well.
“The recent slowdown in the economy has caused home improvement spending to weaken again,” said Eric Belsky, managing director of the Joint Center. “Falling consumer confidence levels have undermined interest in discretionary remodeling projects.”
“What looked to be a promising upturn in home improvement spending earlier this year has begun to stall,” added Kermit Baker, director of the Remodeling Futures Program at the Joint Center. “Housing starts, existing-home sales and house prices have all been disappointing lately, which has dimmed prospects for home improvement spending gains this year.”
The Remodeling Futures Program, initiated by the Joint Center for Housing Studies in 1995, is a comprehensive study of the factors influencing the growth and changing characteristics of housing renovation and repair activity in the United States. It seeks to produce a better understanding of the home improvement industry and its relationship to the broader residential construction industry.