After three years of decline in the market, remodeling is poised for a comeback in 2011, according to the Harvard University Joint Center for Housing Studies.
The Center's quarterly Leading Indicator of Remodeling Activity, released this morning, calls for double-digit year-over-year growth in remodeling in the first and second quarter of 2011.
The LIRA measures homeowner improvements in four-quarter moving totals. it doesn't track maintenance and repair spending, which is generally more stable, or work on renter-occupied buildings.
“Remodeling contractors are feeling much more positive about the outlook for home improvement projects,” says Kermit Baker, director of the Remodeling Futures Program at the Joint Center for Housing Studies. “Low financing costs and a wave of previously foreclosed homes coming back on the market and in need of renovation are expected to generate healthy growth over the next several quarters.”
The LIRA puts the market at $112.2 billion for the year ending with the third quarter of this year, flat from 2009. However, Harvard is predicting 3.1 percent year-over-year growth for the fourth quarter this year. Projections for next year are growth of 11.8 percent in the first quarter and 12.8 percent in the second.
That would put the market at $133.1 billion for the year ending in the second quarter of 2011, the highest number since the remodeling market started slowing in 2007.
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