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).
Kitchens and Bathrooms Are the Main Attraction
Interior spaces are the most popular areas to renovate (72 percent), and homeowners tackle an average of nearly three interior projects at a time. Kitchen and bathroom remodels remain the top projects, and a larger share of homeowners upgraded these spaces in 2022 (28 percent and 25 percent, respectively) compared with 2021 (27 percent and 24 percent, respectively). Kitchens and primary bathrooms also command the highest median spend at $20,000 and $13,500, respectively.
Aging Homes Call for Systems Upgrades
As the median home age in the U.S. continues to increase, homeowners focus on home system improvements. Nearly 3 in 10 homeowners upgraded plumbing in 2022, closely followed by electrical and home automation (29 percent, 28 percent and 25 percent, respectively). Electrical upgrades gained 4 percentage points in 2022 after remaining stable at 24 percent for the previous two years. Among typical home system upgrades, cooling and heating systems commanded the highest median spend in 2022 at $5,500 and $5,000, respectively, and are undertaken by more than 1 in 5 renovating homeowners.
Baby Boomers Lead in Renovation Activity
Baby boomers*** continued to lead in renovation activity (59 percent); followed at a distance by Gen Xers and Millennials (27 percent and 9 percent, respectively). That said, Gen Xers surpassed Baby Boomers in median spend in 2022 for the first time ($25,000 versus $24,000, respectively). Interestingly, Gen Xers and Millennials were slightly more likely to pursue an addition (10 percent, each) than Baby Boomers (9 percent).
Construction and Design Pro Hiring Jumps
While homeowners hired specialty service providers most frequently, construction professionals, such as general contractors and kitchen or bathroom remodelers, came in a close second in 2022 (46 percent and 44 percent, respectively). The share of homeowners who relied on construction pros grew by 6 percentage points (from 38 percent in 2021) and design-related pros saw the same increase, growing from 20 percent in 2021 to 26 percent in 2022.
Smart Lighting Gets a Big Boost
Light fixtures were the most popular indoor technology purchase among renovating homeowners in 2022 (55 percent) and the share of renovators choosing it grew by 4 percentage points year over year. Notably, the share of homeowners opting for smart lighting, which can be controlled from a mobile device, grew from 14 percent in 2021 to 17 percent in 2022.
* Median spend is the midpoint level, meaning half of renovating homeowners on Houzz spent more and half spent less.
** The 2023 Houzz U.S. State of the Industry was fielded November 17, 2022 to December 19, 2022 and garnered responses from over 2,000 home improvement firms on Houzz about business in 2022 and expectations for 2023.
*** Generational categories follow Pew Research Center’s age ranges: Gen Zers (18-24), Millennials (25-39), Gen Xers (40-54), Baby Boomers (55-74) and Seniors (75+).
The Houzz & Home Study
The annual U.S. Houzz & Home Study is the largest survey of residential remodeling, building and decorating activity published. The survey covers a wide range of renovation projects in 2022, 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 2023. The 2023 study includes more than 46,000 respondents in the U.S. alone, providing insights into the home improvement activity of the millions of users of the Houzz site and mobile apps.
The 2023 U.S. Houzz & Home survey was sent to registered users of Houzz and fielded between December 2022 and February 2023.