While the housing market and the overall economy are beginning to make slow gains, experts are predicting stronger spending in the home improvement market over the next decade, according to Harvard University's Joint Center for Housing Studies (JCHS) report, "A New Decade of Growth for Remodeling."
While the large numbers of foreclosures and weak housing prices have created downward pressure on home improvement spending, the JCHS predicts that won't prevent strong remodeling growth in 2011. After a surge in activity early this year, home improvement spending will slow down in the third quarter to a respectable annual growth rate of 6.5 percent ($123.5 billion).
In the long term, the JCHS predicts steady growth in the remodeling market continuing over the long term thanks to the large number of homes in the housing stock, their age, and projected gains in homeowner income levels.
Maintenance and basic improvements that were deferred during the recession will drive spending, as will purchasers of foreclosed homes requiring updates. Rather than moving, owners are likely to focus on improvements to their existing homes that will accommodate their lifestyles for years to come, such as HVAC system upgrades, kitchen or bath renovations, or replacements for roofing or windows.