As homeowners spent much of last year inside their homes, they had ample time to consider redecorating, renovating and completing other home improvements that they may not have had the time, money or resources for in previous years. In Houzz’s 2021 Houzz & Home Report, 75,470 U.S. respondents provided input on their home renovation activities in 2020 and 2021.
Home renovation spend has grown 15 percent in the last year to a median $15,000. Higher-budget projects saw an increase from $85,000 or more in 2020, compared with $80,000 in the two years prior. The study also found that the busy renovation market will continue in 2021, with 56 percent of homeowners planning to renovate this year.
Homeowners who reported they had wanted to pursue a home renovation all along and finally had the time increased by six percentage points in 2020 (44 percent versus 38 percent in 2019), and remains the top renovation trigger. Wanting to do it all along and finally having the financial means also rose (36 percent compared with 34 percent in 2019). Twenty-five percent of homeowners claimed to have renovated instead of moving to find a home that fit their needs because it was the more affordable option. Remodeling to adapt to recent changes in lifestyle only increased by two percentage points in 2020 from 2019 (18 percent versus 16 percent in 2019).
Cash remains the top form of payment for home renovations (83 percent), and the share of homeowners opting to finance their projects with credit cards fell to 29 percent from 37 percent in 2019. Tax refunds gained popularity among renovating homeowners in 2020 (10 percent), especially when funding small projects up to $5,000.
Kitchen projects are the most popular among renovating homeowners, with investment on major remodels of large kitchens rising 14 percent to $40,000 in 2020 compared with $35,000 in 2019.
Outdoor areas have increased in popularity, with 57 percent of renovating homeowners taking on outdoor projects. Improvements to outdoor spaces were directed toward beds or borders (35 percent) and lawns (20 percent). Exterior upgrades, such as decks and porches (14 percent) or balconies (12 percent), also increased in popularity in 2020, with homeowners investing 25 percent more in deck and porch upgrades ($2,500 and $1,500, respectively) compared with 2019.
Smart home technology purchases continue to rise in popularity, with streaming-media players (14 percent) and TVs (12 percent) experiencing the greatest increases compared with 2019. A larger share of renovating homeowners purchased smart technology products, including security cameras (19 percent), light fixtures (7 percent) and speakers or sound systems (3 percent), for their outdoor spaces than in the previous year.
Generationally, while Baby Boomers (ages 55-74) have historically led in renovation spend, Gen Xers (ages 40-54) narrowed the gap in 2020. Median spend for Baby Boomers remained flat at $15,000, while Gen Xers increased their median spend to $14,000 (from $12,000 in 2019).