The orange smocks are smiling after Home Depot finished this fiscal year’s second quarter, which ended August 1st. The home improvement retailer reported an increase of 1.8% in net sales, which isn’t groundbreaking—but is positive.
Business Is On The Upswing
For a business that revolves around home improvement to make any profit in a such a dormant housing market is a triumph in itself. Even more reassuringly, this was the Home Depot’s second consecutive quarterly increase after over four years of losses. According to Market Watch, some of the credit for this increase has been given to the recently-instigated federal home-buyer tax credit—which granted a tax credit to first-time homebuyers purchasing a primary residence—and the tax credit’s upcoming expiration causes uncertainty about sales in the near future.
Housing Still Suffers
Also worrisome are the reports that the fewest building permits (which can predict future construction) in over a year have been issued this summer, and that new construction and housing has missed analysts’ previous forecast. Bloomberg tells us that despite a record low in mortgage prices, the 10% unemployment rate and constant rate of foreclosures keeps a cap on the housing market. When it’s all a person can do to hold on to her home, she isn’t very well seeking to improve it.
Choose To See The Glass As Half Full
Granted, a tiny increase in sales from one of the stores we pass on the way to work in the morning doesn’t exactly fill us with elation. But we choose to take it as foreshadowing in the gothic novel we’re currently living. The overall tone is of anguish and hopelessness, minus the occasional ray of light that illuminates a talisman of hope for the future. Home Depot: feel free to be our talisman.
Tell us in the comments: Do minute increases in business sales and profit give you hope for an economic recovery, or do you need more large-scale indicators?