Remodeling activity will grow by a “healthy” 6% by year’s end, according to an index that measures strength in the sector.
“Hopefully, we’re finally moving beyond simple volatility in the home improvement spending numbers to a period of sustained growth,” said Eric S. Belsky, managing director of the Joint Center for Housing Studies at Harvard University, explaining that the recent uptick in home sales “should translate into more remodeling activity later this year.”
The Joint Center’s Remodeling Futures Program publishes the “Leading Indicator of Remodeling Activity” index, which is designed to estimate national homeowner spending on improvements for the current quarter and subsequent three quarters.
The indicator, measured as an annual rate-of-change of its components, provides a short-term outlook of homeowner remodeling activity and is intended to help identify future turning points in the business cycle of the home improvement industry. It is released in the third week following the closing of each quarter.
Kermit Baker, the director of the Remodeling Futures Program, said the unusually mild weather this winter in many parts of the country accelerated the pace of homebuilding and home improvement activity. There may be a pause in remodeling activity in this quarter, he said, but a strengthening economy “should provide a foundation for continued growth moving forward” after that.
