Remodeling Market Down But Not Out

Remodeling Market Down But Not Out

While the home remodeling industry has experienced a slowdown and has yet to reach bottom, new research by Harvard University’s Joint Center for Housing Studies finds that the correction will be less severe and could rebound sooner than the home building industry as home improvement opportunities emerge over the next few years.

The report, The Remodeling Market in Transition, cites two factors that affected the downturn in remodeling spending: falling home prices, which diminished the amount of equity owners have in their homes that could be used for improvements and; the rising number of foreclosures or homes at risk of foreclosure, as these owners have less incentive and fewer discretionary funds to invest in their homes.

However, the study also suggests that foreclosed properties may provide opportunities for home improvements as banks and new owners renovate and repair these properties. Areas that also may increase remodeling demand will come from consumers seeking sustainable housing, upgrades to the nation’s aging rental stock and the growing population of immigrant homeowners, whose growing families require changes in how they use their home.

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