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Colliding Factors Lead to a Construction Rehab Boom

March 21, 2022 By David Wolfe

The current real estate resale market is experiencing low inventory and homeowners are increasingly deciding to stay put and focus on home improvement projects. Unless they decide to sell their home fast for cash to a company like Prime Deals. After factoring in the cost, stress, and disruption associated with moving, home owners are finding more value in improving their current space by building an addition, finishing a basement or creating an outdoor experience.   Additionally, the current cost of borrowing money is low, which makes the finances of home projects favorable.   A home owner can cash out of their house or use a 2nd mortgage to finance the project.  Another factor at play in the rehab boom is the lack of travel due to the pandemic.  Consumer dollars earmarked for travel are now being used for home projects like installing a new deck or building a home office over the garage.   Finally, stimulus money made available during the pandemic has also made projects feasible, as many households received unexpected funds from the federal government that can be used for home projects.  The current rehab boom is not without obstacles, as the cost of materials has risen and the supply chain continues to face shortages and disruptions.  This has led to increased overall costs and longer project timelines. These colliding factors are creating hurdles but homeowners continue to show a desire to spend money on large- and small-scale home improvement projects.

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