Economic Concerns Causing Homeowners to Pause on Renovations

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Economic Concerns Causing Homeowners to Pause on Renovations

According to a new study from Houzz Inc., the leading platform for home remodeling and design, 15% of homeowners—1 in 7—have put their home renovations on hold because of economic concerns. The top reasons for postponing projects include budget constraints at 46%, inflation at 42% and a lack of project urgency, with 38% of respondents indicating it was a top reason for holding off on projects.

The study found that many homeowners prefer home renovations to moving, with nearly two-thirds of respondents wanting to stay in their current home rather than buy a new home that fits their needs. Of these 63% of respondents, 22% named renovations as being more affordable as the main reason for staying and 21% believe renovations are a better return on investment.

Despite the hesitation of some homeowners, 69% said they would start a remodeling project this year with 54% taking on a bathroom remodel and 37% tackling the kitchen. Nearly half of the projects planned for 2023 have a budget of over $30,000, and 1 in 5 projects has a budget of $100,000 or more.

“The demand for home renovations continues, but the industry is not immune to challenges posed by a volatile national economy,” says Marine Sargsyan, Houzz staff economist. “Faced with inflation and rising interest rates, many homeowners have been forced to reevaluate their ability to pursue immediate improvements. That said, as homeowners choose to remain in their aging homes rather than move, they continue to turn to industry professionals for assistance with necessary repairs and discretionary projects that improve their quality of life.”