April home remodels hit record high
Home remodeling activity increased 15% in April from one year earlier to the highest level recorded for this critical month, according to data provider BuildFax. BuildFax maintains a database of building permit information. It recently partnered with Equifax (EFX) to combine property history with consumer history for clients. The company also creates a remodeling index using its database. The yearly gain in the index for April marks a year and a half of consecutive gains, a nice surprise for an economy thought to be slumping again. "April traditionally sets a baseline for the rest of the year in residential remodeling activity, and April 2011 is the best we’ve seen since the beginning of the index in April 2004," said Joe Emison, vice president of research and development at BuildFax. Servicers are adopting a new philosophy when managing the sale of previously foreclosed property, and have become more open to making repairs from installing new carpeting or even a new roof. But Emison said most of the activity came from consumers and homeowners. "Very little of the recent increases in residential remodeling are with resale in mind," Emison. "There is always some of that work going on, but it just doesn't make financial sense - generally speaking, today, you lose money if you spend on permitted improvements to try and increase the resale value." Remodeling increased the most in the West, up 18% from a year earlier. But activity dropped 19% in the Midwest, the only region to experience a yearly or monthly drop in April. Yearly gains totaled 11% in the South and 5% in the Northeast. "Given the relatively pessimistic economic news that we heard about April, including a slowing recovery, this is a nice surprise for the industry," Emison said. Write to Jon Prior. Follow him on Twitter @JonAPrior.