Conditions Right for Growth in Remodeling

Cambridge, MA, Jan. 14, 2011 -- The U.S. home improvement industry is poised for growth over the next five years and longer term as homeowners begin replacement and systems upgrades, according to a major report from the Joint Center for Housing Studies at Harvard University. 

"A New Decade of Growth for Remodeling" is the sixth and latest report in the Improving America’s Housing series, published by the Remodeling Futures Program at the Joint Center.

“As both the economy and the housing market stabilize, so too will homeowner improvement spending,” says Abbe Will, a researcher with the Remodeling Futures Program.

Remodeling expenditures are expected to increase at an inflation-adjusted 3.5% average annual rate over the next few years.

The study indicates the industry is beginning to return to a more typical pattern of growth after sharp declines since 2007. 

The number of homes, the age of those homes, and the income gains of homeowners should lead to increases in remodeling expenditures.

“Metropolitan areas with rising house prices, older housing stocks, higher incomes and home values, and a larger share of upscale remodeling expenditures, such as Boston, San Francisco, and Los Angeles, are well-positioned for an upturn in remodeling activity,” says Eric Belsky, managing director of the Joint Center.

Remodeling will also be spurred by lower mobility as because fewer people can afford to move.