Remodeling on the up, with a focus on kitchen and bath
Las Vegas — Experts gave the national remodeling market a vote of confidence at a press conference hosted by The National Association of Home Builders (NAHB) Remodelers at the International Builders’ Show on Tuesday, citing an increased focus on kitchen and bath upgrades.
According to the speakers, residential remodeling is maintaining its steady trajectory toward a recovery, a sentiment that was backed up by NAHB calculations and the lived experiences of remodelers in attendance.
The NAHB expects residential remodeling spending on owner-occupied single-family homes to increase 2.5% in 2014, as well as an additional 1.8% in 2015.
"Remodelers are regaining confidence in the market as home owners continue to upgrade their homes and make repairs or replacements that were deferred during tough times," said 2014 NAHB Remodelers chairman Paul Sullivan. "NAHB Remodelers looks forward to working in a strengthened market as home sales rise."
Paul Emrath, VP survey and housing research, added that NAHB is predicting steady growth over the next two years based on positive findings from its recent Remodeling Market Index (RMI) survey.
The findings suggest that remodeling is rebounding as a whole as home equity levels increase, with a particular focus on kitchen and bath. Most customers who hired a remodeler cited the need to repair and replace old components and the desire to upgrade amenities.
Home prices gain in 2013
Home prices saw double-digit gains in 2013, posting the highest annual rate of increase since 2005, according to CoreLogic’s latest housing report, released Tuesday. Ten states and the District of Columbia reached new all-time price peaks last year.
“We expect the rising prices to attract more sellers, unlocking this pent-up supply, which will have a moderating effect on prices in 2014,” said Mark Fleming, chief economist for CoreLogic.
CoreLogic’s latest report comes after a report from the National Association of Realtors, which showed a strong gain in home prices in 2013. The median sales price for all of 2013 was $197,100 in December, 11.5% above the 2012 median price, according to the NAR’s December existing-home sales report.
CoreLogic’s report also showed that home prices have eased a bit in the last three months. Home prices dropped by 0.1% from November to December, and the year-over-year price increase has slowed. CoreLogic’s report does not adjust for seasonal patterns.
"The healthy and broad-based gains in home prices in 2013 help set the stage for the continued recovery in the housing sector in 2014,” said Anand Nallathambi, president and CEO of CoreLogic. “After six years of fits and starts, we can now see a clearer path to a durable recovery in single-family residential housing across most of the U.S.”
The following states had the highest home-price appreciation, including distressed sales:
- Nevada: 23.9%
- California: 19.7%
- Michigan: 14%
- Oregon: 13.7%
- Georgia: 12.8%