(Reuters) - Growth in U.S. home remodeling expenditures is expected to cool below its historic average of 5 percent by early 2020 in step with slowing home sales and price appreciation, a report by the Joint Center for Housing Studies of Harvard University showed on Thursday.
Homeowners are estimated to have spent $339 billion on remodeling in the first quarter of 2019, a 7% increase from a year earlier, and are expected to lay out $345 billion in the second quarter, up 6.9% year on year, according to the center.
By the first quarter of 2020, spending on home remodeling is projected at $347.0 billion, or 2.6% growth.
This compares with estimated expenditures of $352 billion in the third quarter of 2018, a 6.9% rise from a year earlier, and $353 billion in the fourth quarter of 2018, or a 5.2% increase.
“Home improvement and repair spending has been in an extended period of above trend growth for several years, due to weak homebuilding, aging homes, and other factors,” Abbe Will, associate project director at the center’s Remodeling Futures Program, said in a statement.
“However, growth in remodeling is expected to fall below the market’s historical average of 5 percent for the first time since 2013,” Will said.
Reporting by Richard Leong; Editing by Steve Orlofsky