Record remodeling in'87

By William T. Hausle Director, Market Planning Gold Bond Building Products

XPENDITURES for residential alterations and rePairs aDpear headed for another new r6iord in 1987. Dollars sPent for this purpose have increased every year for the last 20 years except in 1982. Last year they topped $80 billion and should reach at least $82 billion in l 986.

The outlook for 1987 is a 6% to 7% increasebringing the total market close to $88- bitlion. Some significant changes are taking Place in this market. While spending is up across the board, there has been greater emphasis on maintenance and repairs and somewhat less on additions and alterations.

Several studies have shown that repair and remodeling expenditures are concentrated in the first few vears of residency ln a home. Existing home sales have been edging uP foi the past two years from an annual rate of 2.7 million units to over 3.5 million units. This should provide a solid foundation for increased R&R expenditures as new owners make their homes more livable.

Last year saw exPenditures on rental pioperties increase by 290/o. This ias- three times the 9Vo increase in spending for owneroccupied homes. All signs Point to this shift continuing for the next few years because of the growing surplus in aPartments'

New apartments are being built faster than the demand for them is srowing. And investors are rushing io complete units before the less favorable tax laws go into effect. Apartment vacancy rates hit an alltime high during 1986. Owners of older units will continue to sPend more money on maintenance, upgrading and imProvements to lPlease turn to Page 37)

Story at a Glance

R&R expenditures close to $88 billion...greater emPhasis on maintenance and repairs. gypsum wallboard use expected to increase 10"/"