Top markets for affordable renovated housing inventory

Despite the rapidly deteriorating affordability, there is some hope for homebuyers in the form of renovated homes: properties that have been rehabbed into move-in ready condition after being purchased at auction.

HousingWire Magazine: December 2021/ January 2022

AS WE ENTER A NEW YEAR, let’s look at some of the events that we can look forward to in 2022. But what about what’s next for the housing industry?

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This webinar will be a discussion on understanding what’s to come in the future of mortgage lending by analyzing past trends in the industry, evolving consumer behaviors and demographics of the industry’s production capacity.

Logan Mohtashami on Omicron and pending home sales

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Real Estate

Harvard: Remodeling to stall in 2020

Expected to last through the end of the third quarter 2020

Home renovation spending reached a record high this summer, according to Harvard University’s Joint Center for Housing Studies. Although they expected those numbers to continue to soar through the end of 2019, the JCHS now says it expects a complete stall come 2020.

(Image courtesy of Harvard University’s Joint Center for Housing Studies. Click to enlarge.)

The Leading Indicator of Remodeling Activity released by the Remodeling Futures Program at JCHS said that annual gains in homeowner spending for improvements and repairs will dissipate by the second half of 2020.

To that point, the LIRA states that the annual home improvement and maintenance expenditures will post a modest decline of 0.3% through the third quarter of 2020.

“Continued weakness in existing home sales and new construction will lead to sluggish remodeling activity next year,” said Chris Herbert, managing director of the JCHS. “Slowdowns in other key indicators of improvement spending—project permitting, sales of building materials, and home prices—also suggest the remodeling market may be reaching a turning point.”

Back in July, JCHS said that it expected remodeling spending to total a record $331 billion for all of 2019.

Now, the furthest projection in the index (the end of Q2 2020) suggests that spending over the prior 12 months will probably total $323 billion.

“At $325 billion, owner improvement and repair spending in the coming year is expected to essentially remain flat compared to market spending of $326 billion over the past four quarters,” says Abbe Will, associate project director in the Remodeling Futures Program at the Center. “However, today’s low mortgage interest rates may help counter some of these headwinds, which could buoy home improvement expenditure over the coming year.”

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