Those people who predicted a downturn of home renovation and a slowing of the housing market rebound are probably biting their tongues right about now. Major financial website Bloomberg reported high sales for both Home Depot and Lowe’s, both with numbers far higher than forecasted. Slow job growth was cited as a reason for possible slowing of the home renovation trend, but whether that occurred or not, people still seem to have extra money to invest in their homes.
6 Years of High Growth For Home Depot
The chief executive of Lowe’s, Robert Niblock, said, “Some of the recent housing and jobs data has softened a little bit. But we still think the consumer is going to be there, and 2014 is going to be a great year.” Meanwhile, Home Depot’s sales spoke for themselves, with 6 straight years now of meeting or beating projected sales growth. Just last year, Bloomberg said their sales “rose 5.4 percent to $78.8 billion . . . more than twice the 2 percent growth rate the company had initially expected.”
Home Sales Way Up In Northeast
Along with renovation projects, home purchasing has remained high. In the Northeast, real estate companies reported a whopping 73.7 percent increase in home sales. Other areas posted far lower, but still significant, growth rates. Western state’ sales rose 11 percent and Sothern states rose 10.4 percent. The Midwest was the only area with a negative rate; their sales dropped 17.2 percent in 2013.
Home renovation projects getting bigger
According to statistics released by Lowe’s, people aren’t shy about big ticket home renovation projects these days. Their biggest growth in sales has been in purchases of over $500. Niblock said that in 2013’s fourth quarter, home improvement tools, fixtures, and building materials sold better than Christmas gifts. Appliances and flooring have also been significant sources of revenue.
In the months and years immediately following the housing market downturn, homeowners focused on maintaining their homes as best they could without doing anything to improve them. These days, however, Niblock said, “Now that they feel better about the value of their home and the overall economy they are starting to engage in some of this discretionary spending around the home that they had put on the back burner.”
Bad Winter Weather Affecting Sales
Cold winter weather has stunted growth a little in the last month or so, but Home Depot’s CEO Frank Blake said this means they’ll just have much higher spring sales as people finally are able to enjoy being outdoors.
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