Rising renovation trends
It's always savvy business to get a bead on what homeowners and homebuyers are prioritizing.
The Home Improvement Research Institute (HIRI) shares eight crucial trends that are shaping the renovation and remodel market, which experts say is due for "unprecedented" levels of spending. Mind the factors below to get ahead of the game.
Rising competition and lower inventory influence current market trends.
HIRI notes that there's been a spike in first-time homebuyers the last couple years. Sixty-one percent in 2024 compared to 36 percent in 2018, in fact. To lure those new buyers, builders are aggressively offering incentives and rate buy-downs, which HIRI says contributes to narrower price gaps as a result of the limited existing home inventory.
Home searches are also taking longer. "Because of affordability constraints and tight inventory, searches lengthened, averaging 5.7 months in 2024, up from 3.6 months in 2022."
Six key buyer groups are emerging.
HIRI identifies upsizers, downsizers, convenience seekers, space seekers, investors, and accessibility-focused buyers, with "upsizers" and "upgraders" comprising 67% percent of buyers.
The most compelling motivation for buying, per HIRI, is "the desire for a better location."
To reach any buyer group, HIRI suggests prioritizing (and marketing) home value, utilization of limited space and convenience.
Homebuyers are seeking smaller homes but larger lots.
HIRI notes that in 2022, about 41 percent of purchased homes had 4+ bedrooms, compared to 33 percent in 2024. Meanwhile, the average square footage in 2022 was 2,965, compared to 2,218 square feet in 2024.
In 2024, HIRI writes,14 percent of homeowners purchased one acre or more of property, compared to 10 percent in previous years, and 19 percent had .5 to 1 acres, compared to 14 percent in 2022.
Millennials are upping the DIY ante.
"In 2024, Millennials outpaced both Gen X and Boomers in reporting of both advanced and intermediate skill levels. Boomers were the largest cohort to report being DIY novices (41 percent) or be non-DIYers (14 percent)," HIRI shares.
Buyers prioritize discretionary upgrades while home sellers focus on increasing returns.
HIRI writes:
"In 2024, most homeowners renovated within the first year of moving to a new residence, with first-time buyers being more active than repeat homebuyers. Homebuyers focused on discretionary upgrades and interior renovations to improve longevity and functionality, favoring home improvements to their newly acquired kitchens, bathrooms, and floors, while specialized projects required professionals."
To target those recent movers, HIRI says, prioritize kitchen, bathroom and flooring upgrades.
'High-impact' materials in demand for buyers and sellers.
Items most frequently purchased include paints, hardware, sealants, caulks and other adhesives. HIRI notes a shift in where homeowners are purchasing their supplies:
"However, as we witnessed in 2024, they’re increasingly purchasing their products and materials from warehouse clubs, specialty retailers, and hardware stores, a shift from 2022. For example, 39 percent of homeowners utilized warehouse clubs in 2022, jumping to 80 percent in 2024."
Reliance on consumer credit is growing.
"There is an increasing usage of unsecured and other consumer credit sources, such as store credit cards and unsecured loans," HIRI shares.
You can read HIRI's full report here.
