After a downturn in spending on home renovations, homeowners across North America have once again been bitten by the renovation bug. And this bodes well for the economy as a whole in 2013.
Residential investment – including construction and remodeling – is expected to add almost three-tenths of a percent to the U.S. gross domestic product (GDP) in 2013. And, according to the Joint Center for Housing Studies at Harvard University, Americans will likely spend upward of $134 billion by June 2013, up from $115 billion recorded in September 2012. The peak of renovation activity across the U.S. occurred in 2007, when it was 8% higher than that predicted for 2013.
However, even more telling is the impact the entire housing sector has on the economy as a whole. Studies indicate a robust housing industry boosts consumer spending – and consumer expenditures constitute two-thirds of the U.S. economy.
In fact, reports suggest that U.S. consumers are beginning to feel positive again. This is reflected in increases not only in remodeling projects, but also in the purchase of investment furniture.
Homeowners are also looking for changes to their homes that will make their lives easier. Busy families may consider adding a deck, but they’ll likely be looking for low-maintenance decking; some will replace traditional lawns with easy-to-maintain grasses or ground covers.
Many homeowners have downsized to smaller houses where storage is at a premium, so renovations to improve storage capacity will become increasingly popular. Part of this trend is a move toward multifunctional rooms and renovations that can be considered investments in the future.
While aging at home may not yet be a concern to boomer homeowners, most have seen their parents renovate to enable them to continue to live at home. This type of renovation has a future and will grow significantly in the next few years.