Consumer spending on home remodeling projects rose slightly last year, for the first time since 2006. The long, slow housing recovery is partly to blame. Experts say many homeowners who want to trade up or who are unable to relocate for a job are realizing they can't sell in this market and have decided to settle in for the long term. Others, who owe more on their homes than they are worth, figure they'll stay put and renovate rather than lose what little equity they have.
IHS Global Insight, a forecasting firm, is predicting that 2011's 3.3-percent increase in remodeling spending will rise to 5.7 percent in 2012. BuildFax's index of remodeling activity has also risen this past year.
Improving consumer confidence is also fueling the much-needed construction activity in a time when new-home building is at historic lows.
Home improvement spending is critical to boosting the overall housing market and the economy, according to an article in the Wall Street Journal, which notes that during the housing bubble in 2005, $434 billion was spent on single-family home purchases, more than double the amount spent on home improvements. By third-quarter 2011, spending on home rebuilding was 42 percent higher than single-family home construction.
Have you decided to love the home you're in and spend money on remodeling?
Keep up with your wealth and mortgages and follow me on Twitter.
Get more news, money-saving tips and expert advice by signing up for a free Bankrate newsletter.