Homeowner Remodeling and Repair Expenditures Are Expected to Continue to Decline

According to the Leading Indicators of Remodeling Activity (LIRA) released last Thursday (7-20-23) by the Joint Center for Housing Studies (JCHS) of Harvard University, annual expenditures for improvement and repairs to owner-occupied homes are expected to decline at an accelerating rate through the first half of 2024.

The LIRA projects that year-over-year spending on homeowner improvements and maintenance will decrease by 2.7% through 2024Q1 and by 5.0% in 2024Q2, following a slowdown in growth that began in 2022Q4.

The LIRA provides a short-term outlook of national home improvement and remodeling. The indicator, measured as an annual rate-of-change of its components, is designed to project the annual rate of change in spending for the current quarter and the subsequent four quarters, and is intended to help identify future turning points in the business cycle of the home improvement and repair industry.

Adding additional background and her analysis, Abbe Will, Associate Project Director of the Remodeling Futures Program, said:

“Home remodeling activity continues to face strong headwinds from high interest rates, softening house price appreciation, and sluggish home sales. Annual spending on homeowner improvements and repairs is expected to decrease from $486 billion through the second quarter of this year to $457 billion over the coming four quarters.”