LIRA, a forward looking indicator of remodeling activity, continues to project a double digit annual increase in home improvement spending through this quarter and the first quarter of 2014, but cautions it expects a slowdown thereafter. LIRA (Leading Indicator of Remodeling Activity) has projected strong increases since the second quarter of this year, moving from an estimated $128.4 billion in the second quarter to $140.0 billion in the third and $146.1 billion this quarter. As a moving average these increases translate to increases of 10.4 percent in the third quarter and, 15.9 percent in the fourth.
LIRA is a creation of the Joint Center for Housing Studies at Harvard University. It is designed to estimate national homeowner spending on improvements for the current quarter and subsequent three quarters. The indicator, measured as an annual rate-of-change of its components, provides a short-term outlook of homeowner remodeling activity and is intended to help identify future turning points in the business cycle of the home improvement industry.