Home improvement has become a prominent trend as homeowners seek to optimize their living spaces for the long haul. With limited housing inventory, many potential move-up buyers find themselves staying put and investing in remodeling projects instead. The surge in remodeling activity reached a record high in the previous year, and this trend is expected to continue, with more than half of homeowners planning renovations this year.
The primary motivation for many homeowners engaging in renovations is to increase their home's value, especially as they gauge how much their property could be worth amidst market fluctuations. Expanding living spaces has become a popular choice, with more homeowners opting to add square footage to areas like kitchens, bathrooms, and living rooms.
As homeowners embark on these projects, remodeling budgets are on the rise. The median expense for home renovations increased by 22% from the previous year, with some homeowners willing to spend six figures for substantial updates. The rising costs are attributed to the higher prices of materials and products, particularly evident in kitchen and bathroom renovations, which saw significant year-over-year spending increases.
As the median age of homes in the U.S. continues to rise, homeowners are prioritizing upgrades to keep their properties modern and functional. Plumbing, electrical systems, and home automation were among the key areas of focus for updates. Cooling and heating systems were the most substantial expenditures in terms of home system upgrades.
The demand for contractors and specialty service providers remains high, with some markets experiencing delays due to overwhelming demand. Finding the right service providers, appropriate projects, and staying within budget continue to be the main challenges for homeowners undertaking renovations.
To finance their projects, many homeowners rely on cash from their savings, but there is an emerging trend of using secured home loans, particularly for pricier projects ranging from $50,000 to $200,000.
Overall, the remodeling landscape is witnessing an upswing, with homeowners seeking to enhance the value, functionality, and appeal of their properties. As the housing market continues to evolve, these trends are likely to shape the home improvement scene for the foreseeable future.