Spending on Remodeling one's Home is on the Rise
Often, with such good deals to be had of late in the Real Estate market Nationwide, people have been swooping up homes with potential to thus completely remodel them to restore the home to its once lovely state of grandeur. The increase in home sales coupled with the still drastically low interest rates are the cause for such a progression in home improvement efforts. Kermit Baker, the Director of the Remodeling Futures Program at the Joint Center went on to state, Strong growth in sales of existing homes and housing starts, coupled with historically low financing costs, have typically been associated with an upturn in home remodeling activity some months later. While the housing market has faced some unique challenges in recent years, this combination is expected to produce a favorable outlook for home improvement spending over the coming months.
This all comes from the Leading Indicator of Remodeling Activity from the Joint Center for Housing Studies of Harvard University. They predict that for the rest of 2012 home improvement spending will continue to increase and should be at its strongest all the way through the middle of 2013 upon where it is expected to reach double digit growth figures.
The most successful home improvement stores across the Country, The Home Depot and Lowes brought forth surprisingly mixed results concerning the last quarter. Lowes shared that per share income was up 68 cents however this is even to Lowes per share improvements from a year prior and is actually 2 cents less than the estimated 70 cent climb it was expected to make in the aforementioned past quarter of 2012. Moreover, total revenue was down 2% although much of this should be attributed to the fact that the company closed 27 of its stores.
Home Depot, on the other hand, was quite successful in the last quarter and reflected the same positive findings that home remodeling is on the rise. Their per share profit beat out prior estimates of 97 cents per share with a reported $1.01 per share profit in this years second quarter. This, it must be noted, highlights a substantial difference from the 86 cent per share profit looking to year-over-year statistics from the same quarter in 2011. For Home Depots total revenue, there was a 1.7% improvement while the same-store revenue also went up by 2.1%.
More Information: Boston Business Journal
