The past several years have had no shortage of headlines on residential real estate and home remodeling. With the pandemic renovation boom in the rearview mirror, the industry is feeling the trickle-down effect of high interest rates, slowing home sales, and a decrease in home improvement spending.
A January 2024 Leading Indicator of Remodeling Activity (LIRA) report, released by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University, cites that residential improvement and repair spend is expected to decline through the third quarter of 2024 before a slight anticipated increase in the fourth quarter.
Looking at current housing market data and expenditures is an important part of the equation, but marketers and communicators in the home remodeling, design, and real estate markets need to prepare for future opportunities—beyond this year’s spring selling and renovation season—to keep their brand top-of-mind among potential customers.
G&S conducted a survey among more than 350 U.S. homeowners in February 2024 to gain insights into renovation motivations, budgets, and design and product preferences in the next five years. Let’s take long-term outlook at what’s ahead.
Majority of Homeowners Plan to Renovate in Next Five Years; Bigger Projects Top the List
According to the G&S survey, more than half of homeowner respondents—58%—plan to make renovations to their current home within the next five years, with top budget ranges being $10,000-$25,000 (26%) and $25,000-$50,000 (21%).
The top three rooms or parts of the home that respondents plan to renovate in the next five years are the kitchen (32%), bathroom (20%), and the main living space (14%). Complementing these findings, the top three product categories homeowners are considering include countertops (54%), flooring (48%) and cabinetry (45%).
The age of homes among respondents varies, ranging from the very old built between 1700-1899, and the very new built between 2020-2024, but the most popular response in this category were homes built between 2000-2009 (19%) and 2010-2019 (14%).
This combination of near-future renovations with bigger projects among houses that are likely starting to show some wear-and-tear and outdated design is promising data for professional remodeling companies, architecture and design firms, and product brands planning longer term communications strategies. Now is the time to build awareness among homeowners—and strengthen relationships over the next several years—as those who are considering projects move into the decision-making phase.
Changing Design is Homeowners’ Main Motivation to Renovate Across Age Groups; Top Barrier is Budget
The survey delves into the reasons behind homeowners' decisions to renovate or not. Just over half of respondents (54%) cite an update to preferred design style as the main reason for considering a renovation. The supports the trend toward personalized design, anticipated to be a hot topic on display this month’s International Builders’ Show (IBS) and Kitchen & Bath Industry Show (KBIS).
Fixing damage or necessary updates (19%) and planning to sell (16%) round out the top three renovation motivators among all homeowners surveyed.
When looking at generational preferences,* more than half of both Gen Z (54%) and Millennials (59%) cite updating to preferred design style as the main reason, but Baby Boomers dominate this response, with nearly two-thirds (64%) citing that reason.
Among those who noted fixing damage or making necessary updates, 27% of Gen Z selected this as the main reason for considering a renovation. This translates into an opportunity for professional remodelers and home improvement retailers to amp up communications strategies targeted toward the 18-29 age group and first-time homebuyers who need to repair aging homes.
When it comes to planning to sell, Gen X leads the response category among age groups with 30% noting that as the main reason. Perhaps not surprisingly, for real estate agents, a focus on Gen X as a target audience is important over the next five years as homeowners consider downsizing, while also reaching Gen Z to purchase these homes that may soon be on the market.
For homeowners who are unsure or do not have plans to renovate within the next few years, the top barrier is budget, with 44% of all respondents citing this as their main reason.
Budget aside, when purchasing essential large-ticket home products such as appliances and furniture, the priority feature or benefit that homeowners are willing to spend more money on is quality/long lifespan. An overwhelming majority of respondents—70%—selected this choice, trailed by sustainability/eco-friendliness (18%), extended warranty (7%), and on-trend design (5%).
Small Budgets Mean Opportunity for Do-It-Yourself Upgrades, with a Focus on Smart Home Tech
While homeowners with larger renovation project plans and budgets are opportune targets for professional remodeling, architecture and design companies, those with smaller budgets and an inclination to try do-it-yourself (DIY) upgrades are key for home improvement retailers and certain product brands.
According to the survey, an overwhelming majority of homeowners—80%—are very or somewhat comfortable in making basic DIY upgrades without hiring a professional.
With the advent of more affordable, easier-to-install products, it’s a great time to be a brand that offers value to consumers looking to DIY, while bringing their homes into the 21st century. This is especially true for smart home technologies.
More than three-quarters (78%) of homeowners surveyed noted that incorporating smart home technologies/internet-connected devices when renovating is very or somewhat important. The top three smart home product categories on homeowners’ wish lists are lighting (58%), alarm or monitoring system (46%), and cameras (38%), alluding to the idea that safety and security are important.
Digital Platforms Dominate Inspiration and Purchase Behavior
As a marketer or communicator, one of the most important considerations in reaching target audiences is where they are finding and learning about your brand. The G&S survey reveals that digital platforms dominate as sources where homeowners find renovation inspiration. The preferred resource channels are home product brand websites (45%) and Instagram (44%), followed by retailer websites and Pinterest (tied at 41%).
Today’s homeowners are savvy and want to do their research and be armed with knowledge before heading into a brick-and-mortar store. The continued influence of digital communications among consumers adds weight to the importance for home product and design brands in having modern websites that are easy-to-navigate, provide pertinent product and company details, and great visuals. While there is no one-size-fits-all approach, this data also means that home brands need to strategically think about owned and paid advertising initiatives with a multi-channel online presence that includes social media and retailer customer sites.
As the home remodeling, design and real estate markets see an eventual uptick, having a long-term outlook on communications strategies—and being armed with insights into homeowner plans, preferences and behaviors—will put your brand one step ahead of the competition.
If you are one of the more than 60,000 design and construction professionals attending IBS or KBIS this month, we’d love to hear your thoughts on this data and what’s trending in new products, design and education.
Note: Survey results are based on a G&S Snap Poll of 362 U.S. homeowners age 18+ on February 2, 2024.
*Age groups surveyed include:
18-29 (Gen Z)
30-44 (Millennial)
45-60 (Gen X)
60+ (Baby Boomer)