If you’ve been paying attention to the news then you’ve heard a few conflicting reports about what is happening in the home improvement and financial markets.  Here’s a quick explanation and analysis of what they could mean for you if you’re thinking about looking into a home improvement loan in the next several months:

International home improvement giant The Home Depot announced that they will be closing some of its stores and laying off nearly 7,000 employees.  This sounds like awful news until you look a little further: the stores that The Home Depot will be closing consist of 34 Expo Design Center stores, 5 YardBIRDS stores, two Design Center stores and seven HD Bath stores.  Those are all specialty stores with a lot of competition from local and smaller vendors.  The Home Depot admitted that their Expo centers weren’t even doing well when the economy was good and there was a strong housing market.  All the specialty stores affected will go into liquidation starting today, so there are some great home improvement deals to be found!

While the loss of jobs in the home improvement industry is never good, the recent cuts by The Home Depot show that their core business: discounted and affordable DIY home improvement supplies are still relatively strong because The Home Depot is not planning to cut any of those stores.  This means that, essentially, home improvements are still a profitable and growing business and it means your Home Depot Credit Card can probably buy even more things for less money.

Our second bit of “bad news” comes from a report which says that housing sale prices dropped 9.3% to $198,600 in 2008.  The prices haven’t been that low since 2004.  This sounds like bad news until you hear that sales of existing homes actually rose 6.5% in December, which is traditionally a slow month for home sales anyway.

What does all this mean?  It means that while existing homes did lose some of their value in 2008, the latest December numbers show that there is plenty of housing credit now available and it means that plenty of people are still borrowing money to buy homes.  Because these are existing homes, a lot of that borrowed money will obviously be used to improve, customize or otherwise upgrade those homes.  All in all it means that the credit market for small home improvement loans is clearly thawing and moving again.

Overall, if you bought your home before 2004 and if you’re looking for some good ways to stretch the money from a recent home improvement loan a little further, then this is all pretty good news for you.  If you aren’t in one of those situations, then hang in there, the financial loan markets are opening up slowly.  Your best bet for borrowing money to remodel or add on to your home may still lie in borrowing money from a local bank that hasn’t been negatively affected by some of the larger financial institution failings.