Lack of Housing Inventory Creates Remodeling Rush

While the rise in home prices may be disheartening for prospective buyers, it has many homeowners feeling more comfortable to spend money on a remodel. According to a recent survey by LightStream Home Improvement, 58 percent of U.S. homeowners say they plan to spend money to remodel their home this year.

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Other findings in the annual survey show that homeowners are feeling optimistic with rising budgets and increasing rates of outdoor, bathroom and kitchen remodeling. Forty-five percent plan to spend $5,000 or more on their projects (an all-time survey high), and the percentage of people planning to spend $35,000 or more - doubled from 2017.

Remodelers in Minnesota agree with the survey stating many homeowners are looking to take on larger projects.

“This year, we’ve already seen an increase in sales with more buyers looking to do bigger projects and spend more money,” said Meg Jaeger, client relations manager at New Spaces.

The Leading Indicator of Remodeling Activity (LIRA) projects that homeowner spending on improvements and repairs will approach $340 billion in 2018, an increase of 7.5 percent from estimated 2017 spending.

“Despite continuing challenges of low for-sale housing inventories and contractor labor availability, 2018 could post the strongest gains for home remodeling in more than a decade,” says Abbe Will, research associate in the Remodeling Futures Program at the Joint Center for Housing Studies. “Annual growth rates have not exceeded 6.8 percent since early 2007, before the Great Recession hit."