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Spending on home improvements set to increase [Video]

Posted on Monday, January 11, 2016 at 12:46:30 PM

Over the last few years, home improvement spending has seen a string of steady increases. In 2016, another year of respectable spending growth appears to be in order. According to a new report from Fitch Ratings, a U.S. economy strengthening on the back of stellar jobs reports, along with climbing home values, will drive a 4.5 percent jump in home improvement spending this year. 

"Homeowners will typically remodel when buying a home to either fix it up or customize it to their tastes," said Robert Rulla, director of Fitch Ratings. "Potential home sellers also tend to remodel to prepare their homes for sale." 

In December 2015, the National Association of Home Builders released its remodeling estimates organized by zip code. A Washington D.C. area suburb spent the most on home renovations - more than $69 million - followed by four zip codes in Texas, each of which spent more than $56 million. 

More of this kind of incredible spending can be expected in 2016, though higher interest rates have the potential to dampen home improvement financing ambitions and a constrained labor market could slow construction in some markets.