Home Improvement Retailers Report Weak Demand for Big-Ticket Projects

Home improvement retailers reported continued weakness in demand for large renovation projects this week. Home Depot reported mixed first-quarter results on Wednesday. Management stated on the earnings call that it does not expect a marked improvement in underlying demand. Bernstein analyst Zhihan Ma noted that foot traffic at Home Depot has been negative for five straight quarters.

Lowe's reiterated its full-year forecasts on Wednesday morning. CEO Marvin Ellison said the current housing market is the most difficult he has faced since the financial crisis. He added that the softness is concentrated among do-it-yourself customers, who account for the majority of the company's revenue. S.

housing turnover remains at historic lows due to affordability challenges and elevated mortgage rates. Housing affordability for first-time buyers is at a four-decade low, which has reduced move-in renovations and other major home improvement purchases.

Wayfair CFO Kate Gulliver issued a similar warning at a JPMorgan conference earlier in the week. She said demand for big-ticket home items is unlikely to recover this year.