CAMBRIDGE, MA - The amount of money that homeowners spend on improvement projects is expected to accelerate as 2013 progresses, according to the Leading Indicator of Remodeling Activity (LIRA) released April 18 by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. On top of the almost 10 percent growth reflected in U.S. Census Bureau figures for 2012, LIRA projects strong gains in homeowner remodeling spending continuing throughout this year, with some moderation in the pace of growth toward the end of the year.
Existing home sales increased nearly 9 percent last year, and house prices are increasing in most markets across the country, pointed out Eric Belsky, managing director of the Joint Center. “This has increased the home equity levels for most homeowners, encouraging them to reinvest in their homes,” Belsky added.
Kermit Baker, director of the Remodeling Futures Program at the Joint Center, cites capacity issues, skilled labor shortages and volatile pricing as a result of this growth. “The strong growth that we’ve seen recently is putting pressure on the current capacity of the home improvement industry,” Baker says. “Contractors and subcontractors are having more difficulty finding skilled labor, and building materials costs are unusually volatile for this stage of a recovery.”
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