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Reno craze up as spending doubles in past decade

National Post
June 16, 2007

Drywall, dust, dirt, contractor schedules. If you live in Canada, chances are you've lived through a renovation.

In 2006, residential renovation spending rose 7.4% after inflation, almost double the level of a decade ago, according to a housing report released by Altus Clayton. This fervour is expected to continue through 2008.

Annual growth in renovation spending averaged 7.2% per year (after inflation) for the past five years, which is 2.6 times faster than GDP growth through the same period.

Highlights of the report:

- New and existing MLS home sales stimulate renovation spending. The Altus Clayton report, conducted on behalf of the Canadian Real Estate Association, shows that in the first three years after buying a home, homebuyers spend about $7,500 more on average than other homeowners on renovations. The annual number of resales is up almost 25% from five years ago, continuing to boost renovation spending.

- Homeowners continue to be courted by retailers. Home-improvement stores are wooing homeowners to undertake renovations by providing innovative products, easy financing (albeit with high interest rates) and access to DIY seminars. Magazines and television shows are in full swing.

- Ageing-in-place renovations may have an impact. As retirement nears, empty nesters become concerned whether their homes will still accommodate thier needs. Remodelling is on the rise.

- Energy-efficiency renovations gain ground. The green trend has an enormous effect, as more people are upgrading their homes to make them energy efficient. The federal governments new ecoENERGY Retrofit program provides added incentive. It provides up to $5,000 per home toward such renovations.

Posted on Tuesday, July 3, 2007 at 02:54PM by Registered CommenterElaine in | CommentsPost a Comment | References1 Reference

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