Resiliency of Home Improvement: A Perfect Storm of Favorable Factors

Home improvement is poised to maintain its robust momentum following a small stint of normalized to neutral growth, buoyed by a convergence of compelling factors that underpin this enduring trend. At the forefront of this surge is the historic levels of equity that homeowners currently enjoy. This newfound financial stability empowers homeowners to embark on projects that enhance the comfort, safety and value of their abodes. From HIRI's Q2 2023 project activity report, we see 2 quarters of growth following a low in Q4 of 2022.

Complementing this equity is historically low unemployment rate and above average wage growth. At face value, this simply contributes to inflationary pressures as households are willing to spend more to get what they want. As we dive deeper, it is clear that historically low unemployment is actually contributing significantly to the stability of the housing and home improvement sectors.

The US is estimated to have roughly 5 million fewer homes than it needs and there is no skilled labor solution in sight to address this. Given the large contribution of housing-associated costs to inflation, the Fed has a tremendous challenge of solving for inflation without being able to fundamentally address the root cause of the issue: too few homes for those wanting to own them.

It is unlikely that we'll see any sort of 'correction' occurring in the housing or home improvement space. Responsible lending of the last few years will help ensure that those embarking on home improvement ventures are well-positioned to undertake these projects, reinforcing the average growth we've seen over the last 10 years.

In tandem with the financial backdrop, the consumer's wallet tells a story of its own. While discretionary income and savings rates have dipped from their historic highs, they remain optimally positioned to fuel continued home improvement expenditures. Homeowners, armed with the confidence of equity and guided by a desire to remodel-in-place rather than buy a new home that contains their upgrades, will further sustain home improvement spend.

In this era where the home has emerged as an all-encompassing sanctuary, the pursuit of home improvement is more than just an economic activity-it's a manifestation of the desire for comfort, safety, functionality, and personal expression. As the economic landscape evolves, one thing remains clear: the trajectory of home improvement continues to point upwards, driven by the winds of financial prudence and the aspiration for an ever-enhanced dwelling.

Stay on Top of Changes in Customer Sentiments and Home Improvement Behaviors

The Home Improvement Research Institute will continue to relay Homeowner and Pro customer sen_ti_ments through various monthly, quarterly, and annual research and reporting. Don't just skim the highlights'-join HIRI for instant access to the full data sets in order to measure industry wide sentiments and spending behaviors in comparison to your company's internal figures.

Attend the Annual HIRI Summit to Keep Ahead of Market Changes

The hous­ing and home improve­ment mar­ket con­tin­ues to change rapidly.

If your brand is to stay rel­e­vant to Pros and DIY­ers while main­tain­ing and gain­ing mar­ket share, you and your team must keep your minds sharp to cur­rent indus­try trends and cus­tomer behaviors.

HIRI’s Home Improve­ment Insights Sum­mit is the pre­mier event deliv­er­ing the lat­est insights into con­sumer and pro cus­tomers atti­tudes, dis­tri­b­u­tion chan­nel shares, and hous­ing macroeconomics.

You’ll be hear­ing from experts in the indus­try who will be bring­ing to you research-based guid­ance for under­stand­ing mar­ket dri­vers, fore­see­ing changes, and dri­ving prod­uct and ser­vice strat­e­gy and innovation.