Home Improvement Finance: Evidence from the 2001 Consumer Practices Survey

Household’s net-worth increase at the end of the 1990’s had an effect on home remodeling financing. Using the 2001 Consumer Practices Survey (CoPS) this paper analyzes the use of home secured products to finance home improvements. The data show that the cost of the project and household characteristics play an important role in the decision for tapping home equity. The paper suggests that the existence of alternative assets and household’s portfolio management are key explanatory factors for understanding home remodeling financing…