In economics and politics, the unmoving and stationary housing industry in the previous years has become a fortunate thing for the home remodeling industry. This is because more property owners stayed, put on added lenses, improved features or renovated their house, letting them adapt to aging.
However, the panic in the real estate market these days has grown to be so deep that it has dragged down the market for home remodeling and renovation which includes window replacement companies. As outlined by a report revealed by the Harvard University Housing Research Center on Thursday, renovation costs may begin to decline next year.
The leading sign of Harvard’s remodeling process reached a 10-year high of 7.7 percent this current year, however, the twelve-monthly growth in remodeling spending is expected to gradually drop to 6.6 percent at about this time the coming year. The United Center said that this is still a healthy growth rate, representing approximately $350 billion in expenditures.
Yet this specific turning point may be worth noting as a housing signal in some respects. Most importantly, it shows that the main solutions Americans have designed to solve the uncooperative housing sector cannot conquer their inertia. As the director of the Joint Center, Chris Herbert, discussed the distressed potential hunters are only among the drivers of the spike in renovation and remodeling spending. The actual house hunter is another – if their numbers are thinner, their spending will be the same.
One more factor – interest rates are rising. For several Americans, purchasing a home becomes more difficult and raise the cost of providing home equity meant for large projects.
The slowdown in the real estate market may also put pressure on some of the participants who have benefited from this uncertainty in the past few years. Credit Suisse analysts downgraded Home Depot HD’s stock by 0.00%, Lowe’s Cos. Low, +0.33%, due to slower house price growth and other factors.
Despite this, some strategists have believed for a long time that Home Depot stocks are economically leading because they play an exceptional role in serving the US consumer and real estate markets.
This is also a key point of the Joint Center report: in the words of the group, it is “a future turning point to help determine the business routine of the home repair and improvement sector.” These turning points are obviously visible in the chart, and they are also significant to the economy. The moment of change corresponds.