by Survey shows interest in projects ranging from bathroom to basement updates
CHARLOTTE, N.C. — Recent research from the Contractor Growth Network released earlier this month shed light on states where homeowners are most interested in renovation projects.
Meanwhile, a follow-up report issued shortly after showed what areas of the home consumers are considering most for their next big project.
The message? People are still interested in spending money on the home, which, of course, could be seen as a positive relating to furniture and bedding sales.
The data is fairly simple in its analysis, as it compiles information from searches related to home renovations. It then lists which states had the most searches per 100,000 residents.
At the head of the list among the top 10 states was South Dakota, with 1,303 searches per 100,000 residents, followed by Delaware (1,263), Oregon (1,245), Vermont (1,189), Colorado (1,184) and Utah (1,170). Rounding out the top 10 states were Montana (1,169), Wyoming (1,158), California (1,132) and Florida (1,102). The remaining states in order of searches on the list are seen in the companion charts included with this story.
And the most popular area of the home to renovate for all 50 states surveyed was the bathroom, with an average cost of $11,365, followed by kitchens and basements. According to HomeAdvisor, an average kitchen remodel will cost anywhere from $14,549 to $40,425, while an average basement remodel or renovation cost ranges from just over $11,00 to nearly $30,000, also according to HomeAdvisor.
With such projects underway, furniture would seem to be a key ingredient to completing the project, whether it be a bathroom vanity, a sofa for the basement or a new dining table for the kitchen. Which is a reason that retailers might want to closely follow not just home sales activity in their areas, but also what people are spending on renovations. The thinking is that with mortgage rates still higher than they were a year earlier, people will put off moving and focus on these types of projects.
However, the price of building materials, while stabilizing, is expected to rise 2% to 4% this year, which is on top of a 14.1% year-over-year increase by the end of last year, according to CBRE Group Inc. Factors that will impact the rate of escalation in prices will be the reliability of the supply chain and labor shortages in the industry, according to lender CrossCountry Mortgage.
Citing Associated Builders and Contractors, the lender states that the “construction industry needs about 546,000 additional workers to keep pace with current demands. With this labor shortage, homeowners may face delays in starting and completing home remodeling projects.”
Nonetheless, it says, the renovation market remains strong, which it says is partly due to a cooling housing market, which in turn could help lower material costs even further. The lender also predicts that instead of building large additions that increase the home’s total footprint, “owners are focusing on smaller cosmetic improvements that enhance the home’s comfort and resale value.”
Another relatively smaller cosmetic improvement that’s likely even less expensive than a basement or kitchen renovation? A new bedroom set, or a new sectional for the living room or sunroom. These also are investments that will increase the perceived value of one’s home, particularly as the market turns and encourages people to start shopping for a home once again.
Putting things in perspective, that kitchen or basement project obviously will create appeal for most new buyers, and perhaps even a higher selling price. But the icing on the cake so to speak is the stylish living room or dining room furniture that graces the room. The message? Don’t let old and outdated-looking furniture take away from all the other work you’ve put into your beautiful home.
We respectfully encourage retailers in these markets to study what’s happening in the housing market in their backyards. And with that information in hand, promote the best of what they have to offer on their sales floor to capture part of the ongoing investment that people are making in their homes.
