Tuesday, January 17, 2006

Blog of the Week: The Big Picture

Remodeling, Building Brace for Slowing

For some strange reason, the WSJ published on Monday, when the markets were closed. If you missed that edition of the paper, you may have missed them this pair of worthwhile reads:

Home Builders Brace For a 'Simmering Down' of Sales As Few Fear a Serious Decline
Home-Remodeling Boom Cools As Higher Loan Rates Begin to Bite

It seems that Builders and Contractors are bracing for the inevitable:

"The home-renovation boom, spurred by low mortgage rates that made home-equity loans popular and cheap, appears to be cooling off.

The latest government construction-spending data -- for November -- shows spending on home renovations was down 4.1% from the month before, and down 5.6% from November 2004.

And the latest quarterly Remodeling Activity Indicator, a measure crafted by Harvard University's Joint Center for Housing Studies to predict trends before the government releases hard numbers, suggests the pace of home-improvement spending continues to slow. "We are starting to see signs of softening in the remodeling market," said Nicolas P. Retsinas, the center's director. "Rising short-term interest rates and slowing home-price appreciation have tempered homeowner spending on home improvements."

The center's quarterly Remodeling Activity Indicator suggests...



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