Home renovation and design activity remains stable year-over-year.
Baby Boomers accounted for over half of renovating homeowners in 2019 (55 percent), according to the ninth annual Houzz & Home survey of more than 87,000 U.S. respondents, up from 52 percent in 2018. Gen Xers (ages 40-54) comprise nearly one-third of home renovators (30 percent) and Millennials (ages 25-39) represent a smaller share of renovating homeowners compared with one year ago (14 percent in 2018 compared with 12 percent in 2019). Overall home renovation activity remained stable year-over-year, with 54 percent of homeowners reporting a renovation project in 2019, and tackling nearly three interior rooms on average. When the study was fielded in early 2020, planned activity for the year remained consistent with past years, however the impact of the coronavirus pandemic on planned renovation activity remains to be seen.
Median spend declined to $13,000 in 2019 from $15,000 in 2018, due to a reduction in average project scope. Baby Boomers offset some of this decline with the highest median renovation spend in 2019 at $15,000, followed by Gen Xers and Millennials ($12,000 and $10,000, respectively). Following the 2018 spike in overall median kitchen remodel spend to $14,000, levels have returned to that of previous years at $12,000, mirroring a drop in the share of major kitchen renovations (from 37 percent in 2018 to 33 percent in 2019). While kitchen renovation spend declined across all age groups, Baby Boomers continued to spend at a median of $14,000 on major kitchen projects.
“Following significant growth in home renovation activity over the past few years, we’re seeing the market settle somewhat in terms of scope and spend,” said Marine Sargsyan, Houzz senior economist. “That said, Baby Boomers, particularly those who have been in their homes for more than six years, are continuing to drive renovation activity and spend, bringing consistency to the market as they pursue projects that will allow them to age in place for the next decade or even more.”
Baby Boomers were three times more likely to pursue a project because they’ve wanted to do it all along than because they wanted to customize a recently purchased home (58 percent versus 20 percent, respectively). Irrespective of their motivation to renovate, they plan to stay in their homes for 11 years or more (60 percent). Home purchases more commonly motivated younger homeowners, such as Gen Zers (ages 18-24) and Millennials (51 and 43 percent, respectively).
COVID-19 Impacts Home Improvement
The Houzz & Home survey was fielded prior to the declaration of the coronavirus pandemic, between January 2 and March 5, 2020. At that time, half of homeowners on Houzz reportedly planned to continue or start renovations this year (51 percent), at a median spend of $10,000, and one third of homeowners planned to make repairs (36 percent).
“Subsequent surveys* have shown that over half of homeowners who were in the midst of a project at the start of the pandemic were able to continue with renovations. That said, some homeowners have opted to delay certain elective renovations due to implications related to social contact, labor and material availability and personal discretionary spending,” said Sargsyan. “Maintenance and repairs, on the other hand, are more likely to proceed, especially when the need is urgent. Deferred maintenance will accrue during this period, setting the stage for a renewed burst of activity following the pandemic.”
Planning Takes Time
Preparing for a renovation in 2019 took homeowners longer than it did to actually renovate on average. While construction took between 2.7 and 4.5 months on average for different types of projects, the planning phase took about twice as long. Kitchens require the most lengthy planning, averaging 8.3 months, compared with master and guest bathrooms (5.4 and 4.8 months, respectively). Surprisingly, entry, foyer or mudrooms, which typically command a smaller square footage, take 6.6 months on average to plan.
Homeowners Look to Professionals for Help
Nearly nine in 10 homeowners hired a home professional for renovation projects in 2019 (88 percent). Specialty service providers, such as electricians and plumbers, were the most common renovation professionals tapped by homeowners (50 percent), followed by construction professionals including general contractors, kitchen or bath remodelers, builders and design-build professionals (36 percent). Design-related professionals, often hired by homeowners irrespective of renovation type, were brought in by nearly one in five renovating homeowners (19 percent).
Projects Funded by Savings
Cash from savings was by far the most common form of home renovation payment (83 percent), even in projects with significant spend over $50,000. The next most common source of funding was credit cards (38 percent), which were more commonly used by those with less expensive projects, between $1,000 and $5,000.
High-End Projects Up Among Younger Generations
Ten percent of renovating homeowners spend $80,000 or more on their home renovations. Among these projects, younger homeowners experienced a growth in expenditure, with Gen Zers up 90 percent and Millennials up eight percent compared to the previous year, whereas Gen Xers and Baby Boomers’ high-end project spend dropped by three and a half and 11 percent, respectively.
Home Offices Get to Work
While kitchens and guest bathrooms continue to be the most popular rooms to renovate (27 and 25 percent, respectively), home offices were added or upgraded by one in ten homeowners in 2019 (10 percent). Millennials and Gen Xers were more likely to pursue a home office project (11 percent, each) than Baby Boomers (9 percent).
Bright and Secure
Nearly one quarter of homeowners made tech-related purchases during their renovations (24 percent), with nearly 70 percent of those purchases being smart technology, which can be monitored or controlled from a mobile device or computer. Light fixtures were the most popular technology purchase during home renovations, with one in ten being a smart light (11 percent).
Other smart technology purchased during renovations include home assistants, thermostats, and alarms or detectors (26, 13 and 12 percent, respectively). Outdoor technology purchases were led by security cameras (17 percent), with two in five of those purchased providing smart technology (20 percent).
Learn More. The annual Houzz & Home survey is the largest survey of residential remodeling, building and decorating activity published. Click here to read the entire study!
*Reference: “Major Home Improvement Projects Continue During Coronavirus Pandemic, Houzz Study Finds,” Houzz, May 20, 2020.