I recently opened the latest report on the state of the nation’s housing units as of 2011 and saw some shocking numbers. One out of every 10 occupied housing units in this country has leaks. What’s worse, one out of every 12 has unsafe drinking water, it said. And one out of every eight showed signs of rodents.
Remodeling publisher Rick Strachan reminded me that I should have known this already: A few weeks earlier, the Joint Center for Housing Studies (JCHS) of Harvard University noted that the number of inadequate houses in America rose 7% between 2007 and 2011 to total 2.4 million. “Evidence of underinvestment is widespread, from rising numbers of inadequate homes to the aging of the rental stock,” JCHS reported. It cited years of foreclosures, short sales, underwater mortgages, home abandonments, and evictions as all helping to aggravate the problem.
But such neglect also breeds opportunity. The housing market is recovering, and there’s increasing interest in energy efficiency retrofits. You’re telling us that home improvement spending has risen a bit over the past year; by one Census Bureau measure, the dollars devoted to remodeling were up 7% in May from a year earlier, while JCHS’ Leading Indicator of Remodeling Activity forecasts about a one-third increase in spending for big-ticket projects this year from its low around the start of 2011.
Expect these trends to continue, not just because we’re still catching up but also because the needs remain so great. Jonathan Smoke, chief economist of Metrostudy, a sister company to Remodeling, notes that half of the nation’s existing housing stock was built before 1976; that’s two years before lead paint in homes was banned. In addition, the average existing home sold in 2012 was constructed in 1974 — and as JCHS’ Kermit Baker likes to point out, builders put up a lot of lousy homes during the 1970s.
And then there’s demographics. Baby boomers figure in about half of all home improvement spending. But for remodelers, they have an even bigger influence because boomers spend more on projects and are more likely than younger generations to hire pros to do the work for them. Indications are that most want to retire where they now live, so you can expect aging-in-place work to grow with each passing year.
Correction: The chart in “Your Guide to Project Management Software” (June 2013, page 26), didn’t accurately show that BuilderTrend, Co-Construct, and BuildTools offer the “vendor portal” feature. Remodeling regrets the error. A corrected chart with additional information is available online.