Report: Home-improvement spending to decelerate in '15

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CAMBRIDGE -- Growth in home-improvement spending is expected to soften as the year progresses, according to a report released Thursday by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University.

The so-called Leading Indicator of Remodeling Activity projects annual growth in home improvement spending to decelerate from 6.3 percent in the first quarter of 2015 (from $134 billion to $142.4 billion), to 1.6 percent by the third quarter (from $137.9 billion to $140.1 billion).

"Due in part to weakening home sales last year, growth in remodeling spending is expected to deflate somewhat in 2015," said Chris Herbert, managing director of the Joint Center, in a statement. "Homeownership rates continue to slide as lending remains tight and first-time homebuyers are not yet returning to the market."

The LIRA is designed to estimate national homeowner spending on improvements for the current quarter and subsequent three quarters. The indicator, measured as an annual rate-of-change of its components, provides a short-term outlook of homeowner remodeling activity and is intended to help identify future turning points in the business cycle of the home-improvement industry.

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Report: Home-improvement spending to decelerate in '15