After a modest downturn, homeowner expenditures for improvements and repairs are expected to trend up through the first half of 2025, according to the Leading Indicator of Remodeling Activity (LIRA) released today by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. The LIRA projects that declines in annual spending for renovations and maintenance to owner-occupied homes will ease to just -0.5 percent through the second quarter of 2025.
“Economic uncertainty and continued weakness in home sales and the sale of building materials are keeping a lid on residential remodeling, although many drivers of spending are starting to firm up again,” says Carlos Martín, director of the Remodeling Futures Program at the Center. “After several years of frenzied activity during the pandemic, owners are now making upgrades and repairs to their homes at a steadier and more sustainable pace.”
“Annual spending on homeowner improvements and maintenance is expected to reach $466 billion through the second quarter of next year, on par with spending over the past four quarters,” says Abbe Will, associate director of the Remodeling Futures Program. “The home remodeling slowdown should continue to be relatively mild, with activity stabilizing just shy of last year’s peaks.”
The LIRA provides a short-term outlook of national home improvement and repair spending to owner-occupied homes. 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 subsequent four quarters, and is intended to help identify future turning points in the business cycle of the home improvement and repair industry. Originally developed in 2007, the LIRA was re-benchmarked in April 2016 to a broader market measure based on the biennial American Housing Survey. The next LIRA release date is October 17, 2024.