Home Improvement – What You Need to Know
Home improvement is the process of upgrading the interior and exterior of a house. These projects can be carried out for a variety of reasons; to increase comfort, upgrade worn-out surfaces or to make a home more functional. Some homeowners may also want to add features that will appeal to future buyers. In general, renovations can boost satisfaction with a home and even help save money in the long run.
Some of the most common home improvements are painting, carpeting and flooring, replacing windows and doors, landscaping, and installing a deck or patio. Many of these projects can be done by a DIY homeowner, while others will require the assistance of a contractor. A professional home inspector can provide valuable insight into any serious issues that should be addressed prior to beginning the project.
According to the 2024 Home Improvement Trends Report, homeowners spent $522 billion on home improvement projects over the past two years. This is a significant increase over the $240 billion spent in 2017 and represents a 9% growth rate year-over-year. This spike in home improvement spending is largely due to the COVID-19 pandemic, with many homeowners upgrading their homes during lockdowns and to accommodate increased family time at home.
However, as the pandemic has ended and households are back to normalcy, home improvement spending has begun to slow. Both Lowe’s and Home Depot reported this week that they are seeing fewer customers tackling ambitious kitchen and bathroom remodels, with many homeowners choosing to stick with low-cost do-it-yourself fixes.
Regardless of why you choose to improve your home, it is important to consider the return on investment (ROI) of any projects that you are considering. While only a few home improvements recoup more than 100% of their cost when sold, high-quality projects can increase buyer interest and resale value.
One way to evaluate ROI is by looking at the difference in resale value between homes that have and haven’t been upgraded. This comparison can be an excellent starting point to determine the most worthwhile projects.
Another consideration when planning home improvement projects is the ability to finance them. Although cash remains the most popular method of payment for these projects, according to the 2024 Houzz and Home Study, mortgages have a strong presence in the market, with homeowners using them to finance 37% of home improvements. Credit cards are a close second, with 23% of owners using them to pay for renovations. While financing can be helpful for large-scale projects, it’s important to evaluate the pros and cons of each option before committing to any loan.