Re­mod­el­ing spend­ing in­creases as ren­o­va­tions are on the rise

The Prince George Citizen - The Citizen - Real Estate Weekly - - Real Estate Weekly -

In the not-so-dis­tant past, home im­prove­ment projects all but came to a halt, as home­own­ers were weary about in­vest­ing any money into fixer-up­pers. But the tides have changed dra­mat­i­cally in re­cent months, and home­own­ers are again ready and will­ing to in­vest big dol­lars into home ren­o­va­tions.

Re­newed con­fi­dence in the econ­omy and an up­swing in the real es­tate mar­ket have con­trib­uted to the re­mod­el­ing frenzy. In early 2014, the Joint Cen­ter for Hous­ing Statis­tics of Har­vard Univer­sity fore­casted nearly $150 bil­lion in ma­jor re­mod­el­ing spend­ing over the year. JCHS said as home­own­ers gain more con­fi­dence in the hous­ing mar­ket, they’re more likely to un­der­take home im­prove­ments they would have avoided in re­cent years.

While the num­bers do not yet match pre-re­ces­sion re­mod­el­ing spend­ing, the num­ber of con­struc­tion projects has steadily trended up­ward. Ac­cord­ing to the Na­tional As­so­ci­a­tion of Home Builders, as of Novem­ber 2014, a greater num­ber of re­mod­el­ers re­ported higher busi­ness ac­tiv­ity than dur­ing the pre­vi­ous quar­ter. Re­mod­el­ing spend­ing has been grad­u­ally climb­ing back up from the all-time low it reached in 2009.

This growth in home ren­o­va­tions has led to more jobs for car­pen­ters, plumbers, painters, elec­tri­cians, and other con­struc­tion work­ers. In Mas­sachusetts alone, a re­cov­ery in over­all con­struc­tion em­ploy­ment has led to a gain of about 18,000 jobs dur­ing the past four years.

The Home Im­prove­ment Re­search In­sti­tute ex­pects an ad­di­tional 5.8 per­cent sales growth in home im­prove­ment spend­ing in 2015. States that showed the high­est lev­els of home im­prove­ment spend­ing in 2014 are likely to con­tinue to hold the top spots through 2015, and the Na­tional As­so­ci­a­tion of Home Builders says these ar­eas in­clude the Dis­trict of Columbia, Con­necti­cut, New Jer­sey, Mary­land, Mas­sachusetts, and ar­eas of south­ern Cal­i­for­nia. Amer­i­cans are not the only ones in­creas­ing their home spend­ing. Ac­cord­ing to re­ports re­leased by Moneris So­lu­tions Cor­po­ra­tion, Canada’s largest credit and debit card pro­ces­sor, pur­chases at home im­prove­ment stores rose by 8.49 per­cent over the same pe­riod last year, and spend­ing on plumb­ing and heat­ing equip­ment and elec­tri­cal con­trac­tors climbed by 5.14 per­cent and 5.08 per­cent, re­spec­tively. Spend­ing pat­terns in­di­cate that home­own­ers are in­vest­ing in DIY projects as well as seek­ing spe­cial­ized work pro­vided by pro­fes­sional con­trac­tors.

Now is a good time for the real es­tate and home im­prove­ment sec­tors, as home­own­ers have re­newed their fer­vor for mak­ing home ren­o­va­tions, both to in­crease com­fort in their homes and make their homes more buyer-friendly.

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