IN ITS THIRD ANNUAL Houzz and Home Survey, Houzz.com confirms what Des Moines home builders and remodelers have been seeing for the past several years: Homeowners, generally optimistic about home values, are willing to invest in a home for the long term, and they’re making changes for livability, not for size.
More homeowners in other areas of the country said they see the housing market as improving, compared to respondents in the Midwest. But this may be more a reflection of activity over the past few years than of current trends. Areas hit hardest by the housing downturn, like the Western and Northeastern states, are seeing a more striking improvement as the market starts to recover.
Because the housing industry in Iowa didn’t drop as significantly as in other areas, we are seeing more steady growth rather than a dramatic change. Over 70 percent of Midwestern homeowners are optimistic about the housing market right now, and the vast majority of those say that values are clearly improving.
As noted in the May issue of BUILD Des Moines, homeowners who choose to remodel right now are doing so out of desire to make their current home more comfortable, not to increase its value for resale.
Remodeler Zac Fleming of Fleming Construction said then, “We don’t do a lot of projects where the homeowner just wants to turn around and sell the house. Our clients are remodeling to stay and see it as an investment that pays off over the long haul.”
The 2014 Houzz survey supports that view for the most part. Over 60 percent of remodeling projects across the country are motivated by a desire to make “changes so their homes better meet their needs.” In fact, when asked why they are remodeling, homeowners consistently chose either “I plan to stay in my home for the long term” or “I have no current plans to move in the next five years.” Few homeowners indicated they were staying put because home prices were too high to consider moving.
The only segment of the market that chose to remodel in order to resell was homeowners under the age of 35, which may be more a reflection of their life stage than an indication of the state of the industry. These homeowners are often ready to move up from a starter home and are willing to put remodeling dollars into an existing home in order to prepare it for resale.
More than 40 percent of respondents indicated they have a remodeling project in mind in the next few years, and nearly 80 percent of those are doing so in order to improve the look and feel of their home or to make it more functional, but not necessarily to make it larger.
About 50 percent of homeowners plan to remodel either a bathroom or kitchen, the most popular remodeling projects as indicated in our May issue.
Devan Kaufman of Kaufman Construction and Zak Fleming both indicated that the most common remodeling projects they quote, year in and year out, are kitchen remodels and bath upgrades, from minor remodels such as replacing cabinet fronts and countertops, updating appliances, and replacing flooring to major renovations that change the room’s layout and completely update the design.
Looking ahead, the construction market for the Midwest continues to look bright. Homeowners are optimistic about home values and sales, so they’re willing to put more money into their current home to make it suit their changing lives. And those anticipating a move in the next few years expect the market growth to continue and increase the value of their existing homes. That means more opportunities for everyone in the industry.