You may have heard the housing market is in the midst of a downturn.
Rising mortgage rates have had an immediate impact on new home sales and mortgage demand, with both down big from 2021.
But Home Depot and Lowe’s aren’t feeling the pain
Both companies reported strong earnings this week in large part due to the popularity of home-remodeling projects, per CNBC.
- A recent survey from Houzz, a home design website, found that 37% of homeowners completed a remodeling project in 2022, and ~25% expect to do one in 2023.
- That same survey revealed that ~50% of homeowners have no plans to sell their home in the next 20 years.
Home Depot CFO Richard McPhail calls this an “improve in place” mentality, where homeowners that would have been looking for a new home turn to improving their existing one.
Since the average age of US housing stock is ~40 years and remote work has people spending more time at home, the trend seems poised to continue.
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