Growth in residential renovations will continue to peak in 2017.
The Harvard University Centre for Housing Studies Leading Indicator of Remodelling Activity (LIRA) expects the home improvement and repair expenditure to continue to increase, surpassing 8% in the second quarter of 2017, before tapering off later in the year.
The South African residential sector tends to follow the trends in the United States. “Homeowner remodeling activity continues to be encouraged by rising home values and tightening for-sale inventories in many markets across the country,” says Chris Herbert, Managing Director of the Joint Centre. “Yet, a recent slowdown in the expansion of single family homebuilding and existing home sales could pull remodeling growth off its peak by the second half of 2017.”
“Even as renovation and remodeling growth trends dip, levels of spending are expected to reach new highs by the third quarter of next year,” says Abbe Will, Research Analyst in the Remodeling Futures Program at the Joint Centre. “At US$327 billion annually, the homeowner improvement and repair market will surpass its previous inflation-adjusted peak from 2006.”