A leading indicator of U.S. residential construction spending rose in the fourth quarter from a year earlier, but business conditions remained weak as the housing downturn lingers, an architects' trade group said Tuesday.
The Home Design Survey Index of residential billings was up 12 points year over year to 32 in the fourth quarter of 2009, according to the American Institute of Architects. A score below 50 indicates a contraction in demand.
But the index slumped from the third quarter of 2009, when it hit 38. A measure of inquiries for new projects was 45 in the fourth quarter, down a point from the third quarter.
"Residential architects continue to report declining business conditions, indicating that the housing market is not yet entering a full recovery phase," the AIA said in a statement.
After a federal tax credit fueled a surge in demand, the housing market recovery has stuttered recently.
In January, pending sales of existing homes fell 7.6 percent to the lowest level since May 2009, while new-home sales fell 11.2 percent.
In this uncertain environment, homeowners can not be certain their homes will appreciate in value, which has made them more restrained in their spending on kitchens and bathrooms, the AIA said.
Instead of larger kitchens and more bathrooms, homeowners are placing a priority on products and features that promote energy efficiency.
"Since kitchens remain the nerve center of the home, doing more with less space is a key consideration," AIA chief economist Kermit Baker said.
Architects are aiming to integrate kitchens with family space, including areas devoted to recycling and spaces devoted to recharging laptops and cell phones.
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