Home renovation is expected to reach $325 billion by early 2017, marking the highest level in 10 years
If ever there were a time for a Home Improvement reunion show, now would be it. The accident-prone Tim Taylor and his schedule-shattering home renovation projects would speak to millions of people around the country, as home improvement spending is expected to reach $325 billion, its highest level in a decade as soon as early 2017, MarketWatch reports.
What’s behind the surge in home renovation? There simply is not enough quality inventory on the market for everyone who is looking to buy a new home. In the past, people would sell their starter homes and purchase a move-in-ready transition home. That isn’t the case anymore. Now, after dealing with the disappointment that comes from being outbid multiple times, homeowners are taking matters into their own hands and calling their friendly neighborhood contractor.
Other homeowners have decided to stay put due to increases in prices. Staying in place allows them to keep their low, fixed-rate payments. Whatever the reason, the outcome is the same; home remodeling spending is going to continue its upward trajectory.
In Q1 of 2013, remodeling spending was at around $235 billion, almost $100 billion less than Q1 of 2017’s projection. The increase in spending between Q4 2016 and Q1 2017 is also projected to be one of the largest quarterly increases of the past five years.
Many remodelers are saying that homeowners are deciding to do more discretionary projects, such as upgrading their kitchens and baths with higher-end finishes. Many projects like these were put on hold after the housing bust. Since people are beginning to realize they may be in their current homes for longer than they expected, their mindset has changed and they are inclined to spend more to make themselves comfortable.
While remodeling a home is less than ideal for many considering how long it can take and how it can make living arrangements difficult during the duration of the renovation, sometimes even causing the homeowners to vacate the house for a period of time, many people are beginning to see it as the best option.