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PRESS RELEASE CONTACT: Elizabeth England: (617) 495-7640 July 17, 2008
(The next LIRA release date is October 21, 2008.) Unraveling Housing Market Weighs Down Remodeling CAMBRIDGE, MA –The weak economy and further distress in housing markets are impeding remodeling activity according to Harvard’s Joint Center for Housing Studies. The Leading Indicator of Remodeling Activity (LIRA) reports that homeowner improvement activity will continue to decline, falling by an annual rate of 11.1% by the first quarter of 2009. “The slumping economy and struggling housing sector continues to drag down spending on home improvements,” notes Nicolas P. Retsinas, director of the Joint Center for Housing Studies. “Households are reluctant to undertake major improvements in the context of falling prices.” “Our re-benchmarked leading indicator focuses on homeowner improvements, and these projects have been particularly hard hit by the housing downturn,” remarks Kermit Baker, director of the Remodeling Futures Program of the Joint Center. “Weak home sales and a growing inventory of unsold homes have discouraged upper-end remodeling activity in many areas.”
The second quarter 2008 release introduces a re-benchmarked LIRA, which was necessitated by the recent discontinuation of the U.S. Census Bureau’s Residential Improvements and Repairs Statistics, also known as the C-50 series. The LIRA now projects future trends in homeowner improvement activity, where previously it estimated trends in both owner improvements and maintenance and repairs. A full description of the re-benchmarking of the LIRA can be found in N08-1: Addendum to Research Note N07-1: Re-Benchmarking the Leading Indicator of Remodeling Activity. The LIRA is released quarterly (April, July, October and January) by the Joint Center’s Remodeling Futures Program during the third week after each quarter’s closing. The next release date is October 21, 2008. The LIRA measures and projects only a portion of the U.S. home improvement market, namely spending by homeowners on property improvements. Other components of the broader market—spending by homeowners on maintenance and repairs, and spending on improvements, and maintenance and repairs for rental and vacation property—are not included in the LIRA figures. The Joint Center’s Policy Advisory Board and other industry sponsors support the Remodeling Futures Program. The development of the LIRA was detailed in N07-1: Developing a Leading Indicator for the Remodeling Industry. Harvard’s Joint Center for Housing Studies is the nation’s leading center for information and research on housing in the United States. Established in 1959, the Joint Center is a collaborative unit affiliated with the Graduate School of Design and the Kennedy School of Government. The Director of the Joint Center for Housing Studies is Nicolas P. Retsinas. For more information, the website is www.jchs.harvard.edu. Future LIRA release dates: October 21, 2008 – Third Quarter 2008 -END- For
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