Home remodeling expenditures rose last year by 2.6%

Real Estate Watch

March 11, 2001

Homeowners spent $101.9 billion on home remodeling last year, a 2.6 percent increase over 1999, according to the Remodeling Activity Indicator from the Joint Center for Housing Studies at Harvard University.

In 1999, the center said, homeowners spent $99.3 billion on remodeling.

Despite a fluctuating economy, spending on home improvements remained "surprisingly resilient," said Nicholas P. Retsinas, director of the Harvard center.

"In spite of a slowdown in the broader economy, remodeling activity is still expanding," said Kermit Baker, director of the center's Remodeling Futures Program. "As long as interest rates remain in their current range, remodeling activity should continue to expand."

The indicator is a cumulative 12-month figure that's released each quarter and based on four components: manufacturers' shipments of floor and wall tile products, retail sales at building materials and supply stores, existing single-family home sales, and the bank prime loan rate.

The RAI is released during the third week after each quarter's closing; the U.S. Commerce Department's data is made available six months after a quarter's end.

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