Spending rises on projects to spruce up homes

Real Estate Watch

May 06, 2001

Homeowner spending on home-improvement projects rose slightly to an annualized $102.5 billion in the first quarter of this year, according to the Remodeling Activity Indicator of the Joint Center for Housing Studies at Harvard University.

In the last quarter of 2000, spending on home improvement totaled $102.1 billion.

Last year's first-quarter spending on home improvement came to $101.5 billion.

"Recent cuts in the prime rate have helped make remodeling projects more affordable at a time when consumer spending in other sectors is beginning to decline," said Kermit Baker, director of the program.

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

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

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