In the past two months, both Scotiabank and TD Economics have published reports on the state of the renovation industry in Canada. Why? Renovation is good business and a major economic driver.
Thanks in part to HGTV and numerous shows, columns and publications, Canadians have become much more aware of home improvement. In fact, we have increased renovation spending by seven per cent a year every year since 2003, to over $5 billion.
In Winnipeg, we lead the nation in renovation thinking. A recent survey found that 58 per cent of our citizens have a renovation project planned for the coming year. We're tied with St. John's, Newfoundland, for tops in the country. This is no surprise since we have the third-oldest housing stock in Canada, trailing only Halifax and Montreal. Locally, rising home sales over the past four years have also encouraged renovation spending. It's quite common for people to prepare their homes for the marketplace by upgrading certain basic aspects. Similarly, when buying a resale home, most homebuyers have a number of improvements they plan to do, many before they even occupy the home. Through normal appreciation of value in the housing market, homeowners have increased the capacity of their home-equity lines of credit, which have been used extensively for renovation projects.
The renovation industry survives in good times and bad. During the financial crisis of 2008-09, it was the only major component of GDP that managed to grow in 2009. Of course, much of that was due to the Home Renovation Tax Credit stimulus, but it's impressive. Low interest rates have continued to encourage renovation spending or, as I prefer to call it, renovation investment.
Since 2003, the three prairie provinces have seen the most growth in renovation spending, commensurate with the fact they have also seen the most growth in new home construction. Restoration efforts in Calgary and Toronto have supported rebuilding efforts.
We're also seeing changes to existing homes based on demographics. As we all age, seniors are looking to renovations that will improve accessibility, enabling them to stay in their homes longer.
All forecasts call for the renovation sector to remain a vibrant part of the Canadian economy.
Mike Moore is president of the Manitoba Home Builders' Association.
