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The Joint Center for Housing Studies at Harvard University sees continued strong growth in home-remodeling spending this year. AP FILE PHOTO

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CAMBRIDGE -- Strong growth is expected to continue this year in the home remodeling market, according to a report from the Joint Center for Housing Studies at Harvard University.

The Leading Indicator of Remodeling Activity, released Thursday, found that national spending on home remodeling is expected to be about $144.7 billion in the current quarter, about 4 percent higher than the comparable year-ago period.

The report estimates that spending will increase in the second quarter by an even greater amount, 14.7 percent, to $147.6 million, before moderating to 9.9 percent year-over-year growth in the third quarter.

"The ongoing growth that we've seen in home prices, housing starts, and existing home sales is also being reflected in home-improvement activity," said Eric S. Belsky, managing director of the Joint Center, in a statement. "As owners gain more confidence in the housing market, they are likely to undertake home improvements that they have deferred."

His colleague Kermit Baker, director of the Remodeling Futures Program at the Joint Center, noted the slower growth later in the year.

"By that time, we'll be approaching the pre-recessionary levels of spending, and with borrowing costs starting to creep back up, growth rates are likely to slow some," he said.

Originally posted here:
Strong growth seen in home remodeling

Thursday, January 16, 2014, 11:39am

The home remodeling market should see strong growth in 2014, according to a new report from Harvard's Joint Center for Housing Studies. According to the JCHS's Leading Indicator of Remodeling Activity (LIRA), consumer spending on home improvement should grow by double digits in the first two quarter of 2014, moderating to just under 10 percent by the third quarter.

"The ongoing growth that we've seen in home prices, housing starts, and existing home sales is also being reflected in home improvement activity," Eric S. Belsky, managing director of the JCHS, said in a statement. "As owners gain more confidence in the housing market, they are likely to undertake home improvements that they have deferred."

Remodeling spending for the fourth quarter of 2013 was about $140.4 billion, according to the LIRA, up from $126 billion in the fourth quarter of 2012. The report projects that remodeling spending will rise to $144.7 billion by the first quarter of 2014 and more than $156 billion by the third quarter of 2014. At that rate, spending on home improvements will nearly match levels before the housing crash, said Kermit Baker, director of the Remodeling Futures Program at the Joint Center, in a statement.

"However, the strong growth for this cycle may start to ebb a bit beginning around midyear," Baker added. "[W]ith borrowing costs starting to creep back up, growth rates are likely to slow some."

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