Reflecting the slow pace of recovery in the overall housing market, the home remodeling industry is expected to continue its path of moderating growth, according to the Leading Indicator of Remodeling Activity report released by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University.
The LIRA projects annual growth in home improvement spending to ease to 3.1 percent through the second quarter of 2015.
“Stronger gains in remodeling activity are unlikely given the recent slowdowns we’ve seen in housing starts, sales and house price gains,” Chris Herbert, the center’s acting managing director, said in a statement. “While the continued recovery in employment should ultimately keep the market on an upward trajectory, remodeling is likely to see slower growth rates moving into 2015.”
“Growth in home remodeling activity continues to hover around its longer-term average of mid-single digit gains,” added Abbe Will, a research analyst in the center’s remodeling futures program. “Even though the housing market overall has been lackluster, many areas of the country remain economically healthy and remodeling contractor sentiment remains high.”
The Leading Indicator of Remodeling Activity is designed to estimate national homeowner spending on improvements for the current quarter and subsequent three quarters.