Additional Coverage:
- Home Depot says consumers postponing renovation projects, citing high interest rates (foxbusiness.com)
Local homeowners are putting off major renovations due to the current economic climate, according to Home Depot executives. CEO Ted Decker noted a slowdown in large remodeling projects, blaming high interest rates and overall economic uncertainty.
This trend was echoed by Home Depot’s executive vice president of merchandising, Billy Bastek. He pointed to the impact of higher interest rates on big-ticket renovations like kitchen and bathroom remodels, even as smaller projects and hurricane repairs boosted sales.
While some homeowners are still tackling projects, many are now relying on financing options to manage the costs. Interestingly, sales to professional contractors and remodelers are currently outpacing sales to DIY customers.
The housing market continues to feel the pressure of high mortgage rates, which are hovering near 7%. This has created a “golden handcuff” effect, discouraging homeowners with low mortgage rates from selling and further limiting housing supply.
Potential buyers are now facing both high home prices and elevated mortgage rates, leading to a decline in pending home sales. Bastek acknowledged these challenges, stating that Home Depot isn’t anticipating changes in interest rates or housing turnover soon.
Adding to the strain on the housing market, tariffs are also impacting builder confidence, contributing to a five-month low in the National Association of Home Builders/Wells Fargo Housing Market Index.