Home Remodeling Set for Stronger Growth in 2021
Annual gains in spending for improvements and repairs to owner-occupied homes are expected to be modestly higher in 2021 compared to last year, according to our latest Leading Indicator of Remodeling Activity (LIRA). The LIRA projects an uptick in year-over-year growth of home renovation and repair expenditure from 3.5 percent at the close of 2020 to 3.8 percent by year-end 2021.
The remodeling market continues to benefit from a strong housing market—including accelerating growth in homebuilding, sales, and home equity. In addition to routine replacement and repair projects, homeowners are likely to pursue more and larger discretionary home improvements this year as the broader economy recovers.
With the release of new benchmark data from the American Housing Survey, we’ve raised our projection for market size in 2021 by about $4 billion, or 1 percent, to $352 billion. Spending in 2018 and 2019 was slightly more robust than previously estimated, growing 12.8 percent over these two years compared to 11.5 percent as estimated.
For more information, visit the LIRA page of our website.