A new report by Harvard’s Joint Center for Housing Studies (JCHS) suggests that remodeling activity should spike upward in coming months.

According to the Leading Indicator of Remodeling Activity (LIRA), annual homeowner improvement spending may reach double-digit growth by the first quarter of 2013. The indicator projects spending on remodeling to increase to approximately $120 billion by the end of 2012 as compared to $114 billion for the fourth quarter of 2011, and as much as $129 billion by the beginning of 2013. 

"Warm weather in the first quarter temporarily bumped up remodeling activity in many areas," said Eric S. Belsky, managing director of the JCHS.  "By the end of the year, however, positive market fundamentals are expected to kick in, moving the industry out of this ebb and flow period and into a new growth phase."

"Home improvement activity has been bouncing around the bottom of this cycle for almost three years now, waiting for the industry to get some traction," said Kermit Baker, director of the Remodeling Futures Program at the JCHS. "Now, the combination of low financing costs, stronger consumer confidence, improving home sales, and the perception that home prices have stabilized in most markets across the country are encouraging owners to start working on the list of home improvement projects they have been putting off. "