Unsurprising figures were released recently regarding the decline of interest and expenditure in the US home improvement industries. These figures come in the wake of the huge 2000 – 2007 housing boom which has been blamed by many financial experts as the cause of the recession; it was mortgage markets which dealt the first big hit to the world economy due to a high number of failing sub-prime mortgage loans.

However, the dip in home improvement spending is damaging the US economy further because tradesmen, such as builders, decorators, interior designers and architects are struggling to find work. According to studies by Harvard University, Spring is typically a busy time for the home improvement industries but this year fewer people are interested in having work done due to a lack of funds.

Harvard University have predicted an annual decline rate of 12.1% by the third quarter of this year and they stress that spending is unlikely to rise until the economy on the whole sees some recovery. USA Today reported that: “Total sales fell 4.5% to $290.5 billion in 2008, the second consecutive annual decline, according to the Home Improvement Research Institute.”

Adding that: “With housing markets still weak and consumer spending falling generally, the Institute expects home improvement product sales to fall 6.4% more in 2009 to $272 billion,” furthermore, the lowering value of US homes is also being blamed. Many homeowners are concerned that the cost to’re-model’ their home could be greater than the increased worth this would add to their home’s value. To date, the catastrophic effect these trends have had on ‘re-modelling’ industries total $306 billion in losses.

Home furnishing companies are also being hit hard by the decline in the home improvement industry and USA Today also reported on a small business named: Linens ‘n Things which specialised in soft furnishings. They reported that the company “filed for bankruptcy last year.” They also commented that the big brands were not beyond being punished either: “Home Depot saw a fiscal fourth-quarter loss of $54 million and Lowe’s fourth-quarter earnings dropped 60%.”

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