Home renovations continue to be a booming business according to Houzz.com's annual Houzz & Home report. Today the home improvement social media site released its annual survey with over 100,000 respondents, and retailers and designers have a lot to celebrate. The survey predicts 2017 will be another good year for home renovations because:
- In one of the largest increases seen this year, renovators who bought their first home in 2016 spent $33,800 on average, 22 percent more than in 2015.
- Investment in home renovation overall remains strong as homeowners spent $60,400 on average on 2016 renovations, in line with 2015 ($59,800 on average).
- Over half of homeowners on Houzz are planning to begin or continue renovations in 2017 (52 percent), consistent with plans for 2016. Homeowners plan to spend an average of $27,300 on home renovations in 2017, a four percent increase from planned spend in 2016 ($26,400).
If those stats don't have you jumping for joy, maybe these will. Here are three keys finds you need to be watching.
Millennials Make the Move
Slowly but surely, Millennials are making their way into the home renovation industry. Though Baby Boomers (55+) continue to spend three times as much on home renovations as Millennials (24-35), Millennials did increase their home renovation spending by 7 percent to $26,200 in 2016 from 2015.
Overall, these stats are good for retailers and designers. However, this generation is already proving to be vastly different from previous generations, and they don't respond to marketing like Baby Boomers and Generation X. They're also digitally savvy having grown up with the internet, and they are more likely to prioritize sustainability and socially conscious living than previous generations.
Millennials still make up a small percentage of the home renovation market, but that share will only grow. To get ahead of the curve, you need to start preparing your business. Start looking at your website and make sure that it is responsively designed and easy to navigate. If you haven't been active on social media in the past, choose one or two platforms and begin to build up your content and presence. Your online presence will become your first impression, and if your website looks dated and functions poorly, Millennial customers might assume your business is outdated.
When asked which rooms they were renovating, homeowners had some surprises in store.
Their biggest priorities were living space renovations: living rooms, dining rooms and guest bedrooms. Investment in these spaces increased by 11 percent in 2016. It could mean that homeowners are entertaining more and expecting to have overnight guests more frequently. This is great news for furniture showrooms.
More surprisingly, laundry rooms saw a 24 percent increase in investment in 2016, with the average laundry room investment at $2,800. It's unclear exactly what homeowners are renovating in their laundry rooms, but furniture and decor showrooms may want to consider investing in organizational decor such as large baskets and bins that can serve as laundry baskets. Other organization drawers and small cabinets could also help homeowners redoing their laundry rooms.
One important point to note is that kitchen and master bathroom investment remained pretty flat from last year ($19,100 for kitchens and $11,700 for master baths, averaged across a wide range of room sizes and project scopes, says the survey). That's not to say that these rooms no longer matter, but showrooms may be able to attract more customers with a larger variety of living space products to offer.
Smart Homes on the Rise
Smart home technology is quickly becoming a priority for home owners, especially for recent buyers. More than a quarter of surveyed homeowners said that home automation integration was very important to their renovations. One-third of recent buyers said they were investing in smart home installations, though only 16 percent of long-term owners said they were doing the same. Recent homebuyers are the most likely to prioritize integrating smart technology during renovation projects (35 percent for first-time buyers versus 31 percent for repeat buyers and 27 percent for long-time homeowners).
While we do not know the demographics of the recent buyers, we can infer that many of them were probably either older Millennials and younger Generation X-ers, which means this trend will probably grow in the coming years as more Millennials buy their first homes.
Lighting showrooms and designers should especially be watching this trend. Your showroom employees should be reading up on the latest smart home lighting trends, and they should have a good understanding of how all these products can work (or in some cases not work) together. Designers should be doing the same. More and more clients will be asking about smart home technology, so it's in your best interests to be on top of the trend now.
What surprises you most from this survey? Share with us in the comments!