Key home improvement trends to monitor

Home improvement spending trends

According to HIRI, approximately 65% of homeowners view inflation as their top concern right now, and 57% said the “economy in general” is their chief worry.

HIRI writes: “Inflation, rising remodeling costs, and stagnated incomes are influencing homeowner readiness within the home improvement industry in 2024, although not equally across the board.” However: “Certain demographics remain interested and eager to take on new projects, while others are more hesitant or might choose smaller DIY projects instead of large-scale remodels and renovations.”

Here’s a sampling of what HIRI views as key trends for the rest of 2024 and beyond.

Soaring home renovation costs could fuel increased DIY activities. However, consumers seem to be reordering priority projects and cutting back where they can. HIRI writes: “Despite a roll­back in numer­ous dis­cre­tionary cat­e­gories, home­own­ers still plan to spend about the same or more — rather than less — on home improve­ment, while depri­or­i­tiz­ing home goods and décor, going out to eat, enter­tain­ment, and vacations.” They’re seeking less expensive materials to get the job done, too.

Overall home improvement spending is increasing. Spending on home improvement went absolutely bananas during the pandemic years of 2020 and 2021 but has cooled significantly since. However, HIRI sees a bounceback ahead. “That growth should con­tin­ue steadi­ly from 2025 to 2028, result­ing in a rough­ly $642.3 bil­lion home improve­ment prod­ucts mar­ket by the end of the fore­cast­ed peri­od. The pro­fes­sion­al mar­ket was hit hard­est in 2023 but is expect­ed to increase steadi­ly dur­ing the next cou­ple of years.”

Younger homeowners, especially, are looking for a change. HIRI’s research shows that a majority of homeowners would be keen to move, depending on interest rates and if the price were right. Younger people (ages 25-44) and those with incomes over $80,000 are the most likely group wanting to move houses, but those who’ve owned their homes for over 20 years are more likely to stay put.

Look to previous expenditures to predict future spending. HIRI explains: “There’s a notice­able rela­tion­ship between home­own­ers who feel locked into their cur­rent hous­ing sit­u­a­tion and what they’re will­ing to spend on home improve­ment,” adding that “locked in home­own­ers have spent an aver­age of approx­i­mate­ly $7,000 on home improve­ment in the past year — and they are antic­i­pat­ing to spend even more in the next 12 months.”

High-income homeowners may be ready to sell. HIRI says those with the “means and motivation” to sell their homes are more likely to undertake home improvement projects. However, “ ‘Prepar­ing a home for sale’ as a moti­va­tion for under­tak­ing a home improve­ment project leads to an aver­age spend of less than $4,000. Home­own­ers tend to spend more on a project when it is moti­vat­ed by some­thing else, such as improv­ing qual­i­ty of life or prepar­ing to age in place.”

Smaller projects are hot right now. Homeowners seem to be putting off more expensive overhauls—or simply downsizing the scope of their vision. HIRI writes: “About two-thirds of home­own­ers feel it’s a bad time to start a home improve­ment project that costs more than $5,000,” adding that “about 70% of home­own­ers in 2024 feel that it’s ​’about the same’ or even a ‘good time’ to start a home improve­ment project under $5,000.”

Substance over style. HIRI’s research finds that homeowners are increasingly taking on projects that help them maximize overall enjoyment, rather than adding stylistic flourishes. “The great­est moti­va­tion for under­tak­ing home improve­ment projects in the past 12 months was ​’to bet­ter enjoy’ a home, fol­lowed by updat­ing the ​home’s style.” 

For more insights into homeowner spending trends moving forward, read HIRI’s full report here.