Harvard University recently released its latest quarterly Leading Indicator of Remodeling Activity (LIRA) report indicating “Strong and Stable” Growth in home renovation and repair spending in 2017. This continued economic strength in the industry provides an opportunity for contractors who provide a choice of payment options to all of their customers to see up to 30 percent growth in sales—or more.
This quarter’s report by the Remodeling Futures Program at Harvard’s Joint Center for Housing Studies said home improvement and repair expenditures will “remain elevated” throughout 2017, with spending levels ending the year up 6.7 percent at $317 billion.
“Growth in home prices is continuing at a healthy pace and encouraging homeowners to make remodeling investments,” Chris Herbert, managing director of the Joint Center for Housing Studies, wrote in the release. “Home sales are remaining on an upward trajectory, as well, and this coupled with continued growth in remodeling permit activity suggests another strong year for home improvements.”
How can you take advantage of the increase in home improvement spending: by offering payment choices to your customers.
Many contractors get caught in the trap that their customers pay only with check or cash, but by thinking that way, you might be leaving money on the table. Offering home improvement loans with different payment options lets homeowners decide what they want to do with their money. The key is to offer choices. Many sales reps are trained to offer the good, better, best options for remodeling projects. By offering choices to homeowners, they may discover a better way to pay for their project—and they may even want to increase the size of the project, because an easy payment option helps them get what they really want.
The LIRA report predicts 2017 will be a good year. Our experience shows that contractors who offer a choice of payment options, such as a same-as-cash loan or a loan with low monthly payments will be much more successful than contractors who just accept cash—in many cases, contractors will see up to a 30 percent increase in sales.