JCHS says remodeling spending to worsen through Q3
The latest Leading Indicator of Remodeling Activity (LIRA), released this morning, points to a decline in annual homeowner renovation and maintenance spending.
Issued by the Remodeling Futures Program at the Joint Center for Housing Studies (JCHS), LIRA forecasts remodeling activity will worsen through the third quarter of this year before moderating slightly to a drop of 6.5% by the end of 2024.
“Home remodeling will continue to suffer this year from a perfect storm of high prices, elevated interest rates, and weak home sales,” Carlos Martín, project director of the Remodeling Futures Program at the Center, said in a statement issued by the JCHS. “These headwinds create considerable uncertainty in the economy, and remodeling spending is projected to fall from $481 billion last year to $450 billion in 2024.”
LIRA provides a short-term outlook of national home improvement and repair spending to owner-occupied homes. Click here for the full study.
“Even with the anticipated downturn, spending for improvements and repairs to owner-occupied homes this year is expected to easily surpass the robust levels seen early in the pandemic,” said Abbe Will, associate project director of the Remodeling Futures Program. “Recent improvements in homebuilding and mortgage rates also support the prospect of turning a corner on the rate of remodeling spending losses by the end of the year.”
The indicator, measured as an annual rate-of-change of its components, is designed to project the annual rate of change in spending for the current quarter and subsequent four quarters, and is intended to help identify future turning points in the business cycle of the home improvement and repair industry.
The JCHS announced the next LIRA release date is April 18.
