Nothing’s Stopping Remodeling Growth
Two major remodeling indices have construction professionals getting giddy
with optimism. All signs point to a strong rebound for home improvement
activity in 2013, according to the Leading Indicator of Remodeling Activity
(LIRA) released by the Remodeling Futures Program at the Joint Center
for Housing Studies of Harvard University (see chart). Robust spending
in the second half of 2012 suggests the remodeling recovery is already
underway, and the LIRA projects annual homeowner improvement spending
will see accelerating double-digit growth through the third quarter of
Data gathered by the National Association of the Remodeling
Industry (NARI) is also up.
The association’s fourth-quarter Remodeling Business Pulse
data of current and future remodeling business conditions has experienced
significant growth across all indicators (see box at top). Two-thirds
of remodelers forecasted the next three months positively, and the rating
jumped 13.1 percent from last quarter.
Drivers of this positive outlook continue to be postponement
of projects (81 percent reporting) and the improvement of home prices
(51 percent reporting).
All 50 States are represented in the latest Improving Markets Index for
February, according to the National Association of Home Builders. This
is up from 242 markets listed as improving in January, and includes entrants
from all 50 states and the District of the Columbia.
Remodeling Growth Indicators
Growth indicators in the last quarter of 2012 include:
• Current business conditions up 2.1 percent since last quarter.
• Number of inquiries up 3.9 percent since last quarter.
• Requests for bids up 3.7 percent since last quarter.
• Conversion of bids to jobs up 3.5 percent since last quarter.
• Value of jobs sold is up 4.3 percent since last quarter.
AAMA, WDMA Update Their Forecast
The American Architectural Manufacturers Association (AAMA) and the Window
and Door Manufacturers Association (WDMA) have released a joint December
2012 update to the 2011/2012 U.S. Industry Statistical Review and Forecast.
And it’s good news for the industry.
New residential construction activity for 2012 is expected
to close at 818,000 units, a 23.9-percent improvement as compared to 2011
and slightly better than forecasted last August. Most of this improvement
is attributed to multi-family starts, according to the report. The study
forecasts similar improvement for 2013, and continues to predict an even
stronger 31-percent new residential construction improvement for 2014
over 2013. Existing home sales are expected to end at 4.7 million units
in 2012, slightly better than originally forecast.
New residential construction activity: Up 23.9 percent
Future growth: Residential construction is expected to jump 31
percent in 2014, over 2013.
Home sales: 4.7 million units projected for end of 2012.
© Copyright 2013 Key Communications Inc. All rights reserved.
No reproduction of any type without expressed written permission.