Remodeling Numbers are on the RiseJanuary 23rd, 2013 by Editor
A new study release by the Joint Center for Housing Studies of Harvard University shows an overall revitalization of the nation’s housing stock is underway. According to The U.S. Housing Stock: Ready for Renewal, foreclosed properties are being transformed, sustainable home improvements are increasing in popularity, older homeowners are retrofitting their homes to accommodate their changing needs and the market shows immense potential.
“As baby boomers move into retirement, they are increasing demand for aging-in-place retrofits,” says Kermit Baker, director of the Remodeling Futures Program. “A decade ago, homeowners over 55 accounted for less than one third of all home improvement spending. By 2011, this share had already grown to over 45 percent. And generations behind the baby boomers will help fuel future spending growth since echo boomers are projected to outnumber baby boomers by more than twelve million as they begin to enter their peak remodeling years over the next decade.”
The surge in “distressed” properties has also added to the hike in remodeling spending.
“After limited spending during the housing bust, renovating the more than one million distressed properties that were sold in 2011 contributed nearly $10 billion to home improvement spending,” says Eric S. Belsky, managing director of the Joint Center. “With about three million more foreclosures and short sales in the pipeline, there is even more such spending ahead of us.”
Remodeling spending for the average homeowner was 20 percent higher in the Northeast and 10 percent lower in the South, compared to the 2011 national average. Austin, Texas, Las Vegas and Phoenix had the most rapidly growing markets while Boston, New York, San Francisco and Washington, D.C., also had higher per owner improvement spending. Energy-efficiency upgrades also saw steady expansion during the remodeling downturn.
“The share of total market spending on energy-related projects rose sharply from 23 percent in 2007 to 33 percent in 2011,” says Abbe Will, a research analyst in the Joint Center’s Remodeling Futures Program. “About a quarter of households undertaking home improvement projects in 2011 did so for energy efficiency purposes.”