Spending stalled across the board in the housing market over the past few years. As lending tightened, many buyers found themselves foregoing moves and holding off on remodels.
That trend is changing, however, as consumer confidence returns and homeowners once again gear up for remodeling projects.
According to the National Association of Home Builders (NAHB), the remodeling market is heating up once again. It is now at the highest level in four years. "Home remodeling continues to slowly increase and continued growth through the year is expected." said NAHB Chief Economist David Crowe. "The fact that some indicators are breaking 50 means remodelers are seeing improving activity in their markets. While credit scarcity and economic uncertainty continue to weigh down remodeling, signs of increasing consumer interest are promising."
The breakdown of all current remodeling market indicators showed increases, from major and minor additions to maintenance and repair.
"Remodelers report a jump in activity so far this year and have been receiving more calls for work and appointments," said NAHB Remodelers Chairman Bob Peterson, CGR, CAPS, CGP, a remodeler from Ft. Collins, Colo. "However, many home owners are still slow to commit to remodeling due to feeling uncertain about the economic recovery and difficulty obtaining loans."
There are still hurdles for homeowners to jump, namely by way of loans. Ninety percent of those surveyed said they still think it is hard to get financing. And many homeowners can no longer rely on home equity lines of credit. Eighty-one percent of those surveyed in the Remodeling Market Index (RMI) noted that they’ve lost equity in their homes. Seventy-four percent are still uncertain about their future economic situation, and 54 percent find inaccurate appraisals are making financing more difficult.
Regionally, all areas experienced growth. The exception was the Midwest, which while it still has the highest rate of remodeling, was down from the 4th quarter of 2010.
Increased interest in remodeling means increased revenue for local contractors and craftsman. This is welcome news for a nation that has seen near 10 percent unemployment. Hopefully, as the economy recovers and buyers regain their confidence, more strides will be made in the housing industry.
Written by Carla Hill, Courtest of Realty Times
May 3, 2011