Homeowners Renovating for the Long Run

Homeowners are renovating their homes for the long run, according to the 12th annual U.S. Houzz & Home Study of more than 46,000 U.S. respondents. More than three in five homeowners state that they plan to stay in their homes for 11 years or more following a 2022 renovation (61 percent). Additionally, the share of homeowners undertaking renovations with a plan to sell their home soon has declined by half since 2018 (6 percent compared with 12 percent in 2018).

Nearly three in five homeowners remodeled or decorated their homes in 2022 (58 percent and 57 percent, respectively) and nearly half made repairs (48 percent). The median spend for home renovations in 2022 was $22,000, whereas the spend for higher-budget updates (with the top 10 percent of spend) reached $140,000 or more. Renovation activity continues into 2023, with more than half of homeowners planning projects this year (55 percent), at an anticipated median spend of $15,000 and $85,000 for higher-budget projects. That said, many home remodeling and design professionals expect slowed growth in 2023, following strong years in 2021 and 2022, according to the 2023 Houzz U.S. State of the Industry.

While the majority of homeowners continued to rely on savings to fund home renovations (82 percent), financing projects with secured home loans became more prevalent (16 percent, compared with 14 percent in 2020). For projects with a median spend of over $50,000, more than a quarter chose secured home loans (26 percent). Credit cards are also a common option for renovations (28 percent); however, the share of homeowners using them to fund projects fell by 10 percentage points year over year.

“Faced with shortages of housing stock and high interest rates, we’re seeing homeowners update their current home to make the space more functional for the long term,” said Liza Hausman, vice president of industry marketing at Houzz. “We’re also seeing an uptick in additions, with the vast majority of homeowners hiring professionals to achieve their goals.”

One in 10 homeowners undertook an addition as part of their remodeling project in 2022 (10 percent), compared with 8 percent each year from 2018 through 2021. The rooms most associated with additions include kitchens, bathrooms and living rooms. Additions typically require professional guidance to meet local guidelines and permitting. In fact, more than 9 in 10 renovating homeowners (91 percent) relied on professional help for their remodeling projects in 2022, up by 2 percentage points year over year (89 percent).

The 2023 U.S. Houzz & Home survey was sent to registered users of Houzz and fielded between December 2022 and February 2023.

The full report is available here.

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