Is the recession over? There are still some mixed signals, but overall, economic indicators signify that the worst is behind us. The housing market is recovering too, though a return to pre-crash levels is expected to take a while.
But in one particular segment of the housing market – the remodeling industry – happy days are clearly here again.
Remodeling Industry Outpacing Overall Housing Recovery
While the broader housing market languishes significantly below pre-crash levels, the remodeling market has fared far better. At nearly $300 billion in spending on remodeling projects, 2013 was the best year since the pre-crash peak of 2007. And overall, spending on remodeling during the past few years exceeds that spent during the few years prior to the housing market crash in 2008.
On average, homeowners spent $2500 on remodeling projects in 2013. While that figure also falls short of the peak year of 2007, it significantly exceeds the average spent per homeowner during the years of 1995 – 2005.
And the recovery in the remodeling market has been anything but slow. From just 2011 to 2013, homeowner spending on home improvement projects increased by almost six billion dollars.
Baby Boomers Leading the Way
The baby boomer generation continues to be the most significant spenders in the home remodeling market. In 2013, baby boomers were responsible for nearly half of all the money spent on home improvement projects.
But spending from the millennial generation is expected to come on strong in the near future. Though this generation has been slow to join the ranks of homeowners, they’ve had a significant impact upon the home rental market. And that has lead to a significant increase in spending on home remodeling projects by encouraging property owners to invest in updating and modernizing homes.
And the Best is Yet to Come…
All of these figures were included in a report recently released by the Joint Center for Housing Studies of Harvard University. The report, Emerging Trends in the Remodeling Market, indicated that the overall housing market is still years away from a full recovery.
But not the remodeling market.
In fact, the report predicts that 2015 may be a record-breaking year in the home improvement industry. Spending on home remodeling projects such as basement renovations, bathroom makeovers and home additions in 2015 may exceed levels spent in any year in history – including the peak pre-crash year of 2007.
So if you’ve been considering a basement renovation, a bathroom upgrade, or any other remodeling project in 2015, you’re far from alone. You’re likely to be a part of a record-busting year in the remodeling industry. That’s why we at TLC Inc. are anticipating a very busy, very hectic, very good year in 2015.