Why Does Older Housing Help Home Depot?
Ben Gilbert says older houses are one reason Home Depot became so large. From 1940 to 1980 the median American home stayed about 23 years old, because new suburbs kept adding young houses. That stopped as Home Depot was getting started. The median age was about 25 by 1990, 30 by 2000, 33 by 2010, and 42 today. The company went public into a stock of houses that would only need more repairs.
The spending followed. In 1975, just before Home Depot existed, Americans spent $28 billion on residential improvements and repairs. Five years later that figure was $47 billion. Today it is $600 billion. Ben treats the aging stock as a predictable tailwind: if the median home is old now, it is older five years from now.
