Home Depot As An Economic Indicator

Home Depot As An Economic Indicator
By: Nicholas A. Dunlap, CPM

Home Depot reported that its profits rose over 72% in the 4th Quarter of 2010. This significant increase means more than just padding to Home Depot’s bottom line. Historically, Home Depots profits have shown increased activity in the rehab and upgrade of residential properties, construction of newer properties and shown that more homes are selling and thus requiring upgrades or personalization. Essentially, people are starting to believe again. People once again have the money to spend on their homes, illustrating the increase in consumer confidence that has been published in recent studies by the Commerce Department (showing we have reached 3 year highs). All of this activity has been helped by low mortgage rates and flat if not slightly declining home values in some areas.

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