PALO ALTO, CA — Homeowners are increasing their spending for kitchen and bathroom remodeling projects, while prioritizing those spaces over others when it comes to residential renovation.
That’s the key finding of the fifth annual “Houzz & Home Survey,” conducted among more than 120,000 respondents by Houzz Inc., the Palo Alto, CA-based online platform for home renovation and design. The survey, whose results were released last month, provides insights into the home-improvement activities of a wide cross-section of monthly users of the Houzz site and mobile apps.
“2015 was another strong year for the home renovation market, with homeowners continuing to increase investments,” said Nino Sitchinava, principal economist at Houzz. “While the majority of renovations are spurred by homeowners’ desire to upgrade a home they’ve lived in for some time, recent home purchases are also an important driver of home renovation activity.”
According to the survey’s findings, the average expenditure for 2015 kitchen and master bath remodeling projects increased by 12% over the prior year. Consistent with the past 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%), Houzz reported.
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, according to Houzz. Homeowners say they 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%), Houzz noted, adding that financial considerations such as renovation being a more affordable option or providing a better return on investment (28% for each) trail behind.
Among other survey findings:
- Over a quarter of renovations are driven by recent home purchases (26%). Renovators of a recently purchased home invest more in their projects than other homeowners ($66,600 versus $59,800). They also embark on larger projects, and are nearly three times as likely to renovate all of their interior spaces than the average renovator (14% versus 5%). 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%).
- 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%).
- Nearly one-third of homeowners take on a remodeling project without setting a budget, and the same share exceed their established budget (31% each). Homeowners who exceed their budgets spend considerably more on their projects ($83,400 average spend) than those who stayed on budget ($52,300). The decision to opt for more upscale products and materials was the top budget-buster (45%), ahead of products/services being more costly than expected (40%) and the decision to change the project scope/design (33%).
- More than four in five homeowners renovated their homes with professional help in 2015. Baby boomers and recent home buyers are more likely than any other groups to hire professional help (88% and 91%, respectively). Among those homeowners who hire a professional for their renovations, nearly half hire a professional remodeler, such as general contractor, builder, kitchen or bath remodeler, or design-build company (46%). One-fifth hire a design professional such as an architect, interior designer, or kitchen or bath designer.