flexiblefullpage - default
interstitial1 - interstitial
Currently Reading

Remodeling Spending Heading Down, Confidence Up

Advertisement
billboard -
Industry Data & Research

Remodeling Spending Heading Down, Confidence Up

The latest LIRA from the Joint Center of Housing Studies at Harvard University projects remodeling spending growth declining next year, while NAHB's RMI shows remodeler's confidence is bouncing back now


By By James F. McClister July 16, 2020

Without the unusual effects of the pandemic—which are admittedly hard to measure and furthermore project—this quarter's Leading Indicator of the Remodeling Industry from the expert researchers at the Joint Center for Housing Studies of Harvard University projects a slight increase in remodeling spending growth from Q3 to Q4 2020 and an even further increase to 4.2% in Q1 2021. The latter would be a year-over-year increase of about one percentage point. 

But the pandemic is here and seemingly unrelenting. As a result, JCHS researchers built a downside model including new inputs—retail sales of building materials, home prices, and GDP—that show a less optimistic rise in spending proceeded by a drop into the negatives. The LIRA hasn't projected negative growth in remodeling spending since 2010, when the effects of the Great Recession were in full swing. 

LIRA from JCHS q2 2020

“As the pace of do-it-yourself activity, maintenance work, and exterior-focused projects begins to taper, annual expenditures by owners for home improvements and repairs are expected to shrink slightly to $326 billion by the middle of 2021,” said Abbe Will, Associate Project Director in the Remodeling Futures Program at the Center. “Given the ongoing uncertainty surrounding the broader impact of the pandemic, the timing on when we’ll reach a bottom in the remodeling market also remains unclear.”

Remodelers Optimistic On Current and Future Market

Still, despite the indutry's turmoil and dampened projections on spending growth, remodelers are regaining their confidence, according to the latest Remodeling Market Indicator (RMI) from the National Association of Home Builders.  

Where remodeler confidence took a nosedive in Q1, particularly as it related to the future of the market, in Q2 it seems their optimism has rebounded—and not just nationally but across every region.

Also, as we've reported in the past, smaller jobs tend to take less of a hit during times of economic hardship and it seems to be no different during these. Remodelers are more confident in the current state of small jobs (i.e., under $20,000) than in any other category surveyed. 

RMI q2 NAHB


written by

James F. McClister

James McClister is managing editor for Professional Remodeler.


Add new comment

Plain text

  • No HTML tags allowed.
  • Web page addresses and email addresses turn into links automatically.
  • Lines and paragraphs break automatically.
leaderboard2 - default

Related Stories

The Latest Data on Construction's Workforce

To close the housing deficit in the United States, the industry needs more skilled workers. Here's where construction's workforce stands

The Remodeling Market Could Turn in Q4, Says Harvard

Repair and remodeling spending could see an uptick at the end of the year

Building Materials Show Stability in 2023

Although supply chain bottlenecks have eased in recent months, shortages of some key materials persist.

Design Trends to Watch in 2024

What’s in and out for the upcoming year? Remodeling designers share insights

Remodeler Sentiment Remains Positive

Surveys reveal a strong outlook, and how the aging population will lift remodeling

Next Year to Challenge Remodeling, Says Harvard

The latest LIRA report predicts greater decrease in home improvement and remodeling spending

Top Siding and Window Colors for 2024

A recent survey identifies the top siding and window color choices for American homeowners

What Does the Past and Present of Remodeling Tell Us About the Future?

On this episode of Remodeling Mastery, industry advisor Mark Richardson shares bits of his keynote presentation at The Pinnacle Experience, highlighting different elements that shape the immediate future of the remodeling market

Remodeling Loan Data Reveals Geographical, National Trends

An analysis of loan data shows the most popular, and least popular, states for home improvement

Remodeling Spending to Decline at Faster Rate, Says Harvard

Remodeling spending may drop for the first time since 2020, according to predictions from Harvard's Remodeling Futures Program

Advertisement
boombox2 -
Advertisement
halfpage2 -
Advertisement
native1 -

More in Category




Advertisement
native2 -
Advertisement
halfpage1 -
Advertisement
leaderboard1 -