Editor’s Note: The following is a transcript from the Norwest Nowcast above where Norwest Partner Stew Campbell explains why consumer spending on home improvement will accelerate despite uncertainty about the economy.
Hi! This is Stew Campbell with a Norwest Nowcast about why I expect consumers to actually spend more money on home improvement and services this year.
COVID and the evolving home-ownership demographics have fundamentally changed how people think about their homes. The current economic environment will only keep homeowners in existing homes longer. It’ll encourage even more investment.
More on these two observations:
- First, the work-from-home movement has turned many houses into combination home/office spaces. It’s prompted remodels. It’s allowed remote workers to take on new jobs without needing to relocate. Backyards have been reimagined. Living spaces re-emphasized.
- Second, in most areas, housing remains one of the best investments a consumer can make and certainly during a market slowdown. Rising mortgage rates and tight housing supply will only force homeowners to postpone any potential moves. They’ll instead use equity value to improve and renovate.
Opportunity exists for home service providers with strong, trusted brands to win and service those customers. Two of our portfolio companies, Junk King and Poolwerx, are prime examples of providers that benefit from this trend.
As homeowners continue to invest in their properties, opportunities will only grow for innovative home service providers.
What do you think? I’d love for you to use the comments section below to share your thoughts on home improvement. Thanks.