Houzz Survey Indicates Rise for Kitchen and Bath Renovation Spending
Homeowners are investing larger budgets into their kitchen and bathroom renovation projects, according to the fifth annual Houzz & Home survey of more than 120,000 respondents in the U.S.
The annual Houzz & Home survey is the largest survey of residential remodeling, building and decorating activity published. The survey covers a wide range of renovation projects in 2015, from interior remodels and additions to home systems, exterior upgrades and outdoor projects. Data gathered includes historical and planned spends, professional involvement, motivations and challenges behind building, renovation and decorating projects, as well as planned activities for 2016.
The average spend on kitchen and master bath remodeling projects in 2015 increased by 12% year by year. Consistent with the last five years, kitchens remain the most popular interior remodeling project (31%), followed by master/non-master bathrooms (22% and 26%, respectively) and living/family rooms (23%). Renovating homeowners also tackled a more diverse set of projects in 2015 than in 2014, with a greater emphasis on upgrades to interior spaces (72% versus 69%) and exterior features like windows and roofing (56% versus 53%).
When it comes to the motivations behind renovations, finally having the time was the top trigger for home renovation projects in 2015 (38%), ahead of finally having the financial means (37%), the top trigger for 2014 projects. Homeowners are renovating instead of buying a “perfect” home largely due to their desire to stay in their current home or lot (49%) or remain in their current neighborhood (31%). Financial considerations such as renovation being a more affordable option or providing a better return on investment (28% each) trail behind.
More than a quarter of renovations are driven by recent home purchases (26%) and more than one in 10 renovators purchased a home in 2015 (12%). Renovators of a recently purchased home invest more in their projects than other homeowners ($66,600 versus $59,800). They also embark on larger scope projects and are nearly three times as likely to renovate all of their interior spaces than the average renovator (14% versus five%). When considering priorities, kitchen projects top the list for these homeowners (41% versus 31% for the average renovating homeowner) along with other major projects to improve the comfort of their home such as home automation (33% versus 19%). People tend to buy a home with the intention of renovating versus seeking an already “perfect” home, with the goals of creating a personalized space (34%), capitalizing on the affordability of renovating versus buying a home (32%), or maximizing their return on investment (32%).
“2015 was another strong year for the home renovation market, with homeowners continuing to increase investment in their homes," said Nino Sitchinava, principal economist at Houzz. “While the majority of renovations are spurred by homeowners’ desire to upgrade a home they have lived in for some time, recent home purchases are also an important driver of home renovation activity. Recent home buyers tend to do more, spend more and are more likely to hire professionals to help with their renovation projects than other homeowners. As the churn in the housing market picks up in the near future, the home renovation market should see meaningful growth.”
When it comes to financing, the majority of homeowners continue to use personal savings/finances to fund their renovations (82%), followed by credit cards (21%). Millennials are most likely to pay for their renovations with a credit card (32%) and Baby Boomers are least likely (17%). While home equity lines of credit are the biggest form of debt financing, fewer than one in ten renovating homeowners leverage this option to fund their projects and nearly one-third of homeowners take on a remodeling project without setting a budget and the same share exceed their established budget (31% each).
Millennial homeowners continue to be just as active as other age groups when it comes to remodeling their homes (61% for Millennials and other age groups alike) and an even greater age are decorating (77% versus 65% across age groups). However, Baby Boomers and others over the age of 55 spend three times more on renovations than Millennials ($73,300 versus $24,500, respectively). While one in five renovating homeowners upgrades or installs a home automation system (19%), Millennial homeowners (26%) and recent home buyers (33%) are even more avid about home technology.
For more information, visit houzz.com.