US house owners spend more for renovation projects for home owners and expand a broader withdrawal of consumers in the middle of a reduced trust in the economy.
Sales for building materials and garden supply dealers rose by 0.8%last month from March, the greatest profit in 2022 and rose by 3.2%compared to April last year. At the same time, the US individual sales turnover increased by 0.1%, a sharp slowdown from March.
The trend even occurs when the prices for home improvement products have increased.
According to Verisks Remodel index, the costs for home repairs and conversions rose by almost 4%in the first quarter in the first quarter. The strategic data analysis company pursues the costs for more than 10,000 repair items from household appliances to Windows.
The recent price increases seem to be mainly based on labor costs and do not seem to reflect the continued trade war, which the Trump administration deals with large US trade partners such as Mexico, China and Canada with large US trade partners.
“We have not seen a panic purchase of contractors or investors who were controlled by the effects of tariffs on future costs or the work rates through stricter enforcement of immigration policy,” said Greg Pyne, Vice President for Pricing for Solutions to estimate Verisk real estate, in a report at the beginning of this month.
Home Depot said on Tuesday that the prices for tariffs would not be increased and that it has been diversified for years for the goods for the goods on the shelves. According to the Executive Billy Bastek, some products could possibly disappear on the Home Depot shelves.
He also noted that the chain was concerned with fewer customers, as it is large remodels for kitchen and bath conversion, since high interest rates may prevent homeowners from giving up money in order to finance such projects.
The expenses for the renovation of homes have remained resistant because increased mortgage interests and the sudden real estate prices have used many potential buyers. This sold us in a break -in at home and limited the market for homeowners who want to sell.
Many homeowners also bought or refinanced their mortgage when the average interest rate for a 30-year housing loan was below 3% or 4% in the early years of pandemic. She reluctantly sold this if the average rate hovers near 7%.
In response to this, many homeowners decided to invest in their apartment instead of selling and taking over a mortgage with a greatly higher interest rate.
A lack of new buildings more than a decade in production has lived people in older houses longer. Almost half of the owner in the United States was built before 1980 and, according to an analysis of the National Association of Home Builders, an average of 41 years. This aging inventory of Homes has contributed to repairs and improvements.
The Harvard University Joint Center for Housing Studies from the latest quarterly prospects for home improvements, which will further increase the expenses for the renovation work in the apartment this year despite economic uncertainty.
The expenditure of homeowners for maintenance and house improvement projects increased by $ 513 billion by $ 0.5%in the first quarter compared to the previous year.
It also forecast annual increases from here, which increase expenses to 526 billion US dollars in the first quarter of next year. This would make up an increase of 2.5% compared to the first quarter of this year.
Rising real estate prices and signs of a solid economy have supported the prospects for higher expenses for improving the apartment. However, this could change if the real estate market and the economic prospects deteriorate, said Carlos MartÃn, director of the renovation program for the conversion of JCHS.
“The retail sales of the building materials are strong, but we see a significant downturn in the sale of existing houses and their middle sales price since the last projection – both are known contributions to home improvements,” said Martin. “Wider economic turbulence such as a recession, a deterioration market or a higher inflation would almost certainly affect our expectations.”