As 2023 progresses, visits to home-improvement retailers Home Depot Inc. and Lowe’s Cos. are increasing, according to foot-traffic data from analytics company Placer.ai.
In January, visits to Home Depot
were down 7% and visits to Lowe’s
were down 7.3% compared with the same month in 2022. In March, visits to Home Depot were down 9.8% year over year and visits to Lowe’s were down 11.1%. Since then, however, visit gaps for the two companies have tightened every month, narrowing to just a 4.2% year-over-year decline for both Home Depot and Lowe’s in July.
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“Despite a cool housing market overall, new single-family home sales likely played a part in the continuing resilience of Home Depot and Lowe’s in [the first half of] 2023,” Ezra Carmel of Placer.ai wrote in a blog post. “New homes require plenty of finishing touches inside and out — from fixtures and paint to landscaping and patio furniture — and warmer weather appears to be encouraging consumers to take on these projects.”
He added: “As new home construction shows signs of heating up, home improvement retailers can benefit from builder foot traffic during the project and homeowner visits after completion.”
Retailers: These retailers are enjoying foot-traffic wins, research says
In June, home prices hit their highest level in a year, boosted by a lack of homes for sale and strong home demand among buyers, according to the National Association of Realtors.
Home Depot has also been driving more traffic from wealthier and larger households, according to Placer.ai. Citing Trade Area Analysis, a process used to map out business activity and consumer behavior in a specific location, Placer.ai said that, during the first half of 2023, consumers in Home Depot’s captured market had a median household income of $74,400 — higher than the median household income of Lowe’s captured market, which was $69,100. “Home Depot’s trade area also had more persons per household (2.67) than Lowe’s (2.58),” Carmel wrote. “This suggests that Home Depot’s visitors may reside in larger family homes— with the potential to need more improvements and upkeep — and have the budgets to take on more projects.”
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Home Depot reports its second-quarter results on Aug. 15. Lowe’s reports second-quarter results on Aug. 22.
Shares of Home Depot are up 4.8% in 2023 and Lowe’s stock is up 12.8%, compared with the S&P 500’s
gain of 16.3% over the same period.
Aarthi Swaminathan contributed.