After a downturn in spending on home renovations, homeowners across North America have once again been bitten by the renovation bug.
And this bodes well for the economy as a whole in 2013.
In Canada, research by the Canadian Mortgage and Housing Corporation (CMHC) indicates spending on renovations had declined during most of 2012, compared to the year previous. But Canadians can expect a boost in 2013, when the $60 billion-plus renovation industry begins to pick up as a result of stronger growth in employment. The CMHC expects renovation spending to increase by 3.6% in 2013, to $65.6 billion.
In Vancouver, where the housing market has retrenched, the reno boom is under way; people now plan to stay longer in their homes and are fixing up instead of moving. Few people are renovating for resale. As Peter Simpson, president and CEO of the Greater Vancouver Home Builders Association, told Reuters recently, homeowners are now “renovating for their own use … (and) they’re not nervous about spending the money either.”
Across the country, many people have downsized to condos or smaller houses where storage is at a premium, so renovations to improve storage capacity will become increasingly popular. Part of this trend is a move towards multi-functional rooms and renovations that can be considered investments in the future.
Many Canadian homeowners are planning to make changes to their houses that will make their lives easier. Busy families may consider adding a deck, but they’ll likely be looking for low-maintenance decking, and some will replace traditional lawns with easy-to-maintain grasses or ground covers.
And while aging at home may not yet be a concern to boomer homeowners, most have seen their parents renovate to enable them to continue to live at home. This type of renovation will grow significantly over the next several years.