The latest Leading Indicator of Remodeling Activity (LIRA) forecasts growth in the remodeling market will remain solid through 2021 and into 2021. The LIRA, released by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University (JCHS), projects a pace of mid-single digit gains in annual home renovation and repair spending in 2021, with 4.8% growth in spending by the first quarter of 2022.
Recent LIRA reports have trended towards a more positive outlook for the remodeling industry than reports released in the early months of the coronavirus (COVID-19) pandemic. Projections from the first two quarters of 2020 forecast remodeling spending would decline by the middle of 2021. However, as greater clarity emerged on the impact of the virus on the overall economy and the residential housing market demonstrated resilience, the LIRA began to project moderate gains for homeowner spending on remodel and repair projects throughout 2021.
Estimated year-over-year growth in remodeling spending during the first quarter of 2021 (5.5%) outpaced LIRA’s projection (5.2%) from the fourth quarter of 2020 and projections for YOY spending growth during the second and third quarters of 2021 are approximately 2.5% higher than projections from the previous LIRA report. The LIRA forecasts growth in renovation and repair spending will increase to 4.8% by the first quarter of 2022.
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