U.S. households saw homeowners and families embark on a wide variety of renovations and remodeling projects over the past year. That is according to new findings in the 2022 Remodeling Impact Report, a joint study from the National Association of Realtors® and the National Association of the Remodeling Industry.
This year's report analyzes a number of home improvement aspects, including why people decide to remodel, the general costs of specific remodeling tasks, and the fulfillment experienced after a successful project has been completed.
"Our study revealed that homeowners tend to undertake a remodeling project for any number of reasons," said Jessica Lautz, vice president of demographics and behavioral insights at NAR. "In some instances, homeowners were content with sprucing up a room with a simple paint job, while in other cases, families decided to take on the task of renovating an entire attic or basement to add additional living space to their home."
The report notes that Americans spent $420 billion in 2020 on home remodeling ventures. Ninety percent of NARI members cited a greater demand for contracting remodeling work during the course of the pandemic. Three out of five NARI members – 60% – said the scale of the projects grew either in a larger project or remodeling more than one room due to the pandemic.
"This report is the first one to measure the impact of the pandemic on the price and relative value of various remodeling projects," said Chris Egner, MCR, CKBR, CRPM, UDCP, and president of NARI. "We are glad that NARI members, who are among the most experienced remodelers, could provide realistic estimates of remodeling costs in line with the criteria specified in the survey."
Although 83% of consumers stated that they would have remodeled regardless of the pandemic, 86% reported that remodeling one area of their home then inspired them to remodel other areas of the house.
The exact reasons why homeowners decided to modify their living spaces varied. Thirty-five percent of owners said the single most important result from their remodel was better functionality and livability. Upon completion of their project, 22% said they had durable and long-lasting results, materials and appliances. Fourteen percent reported beauty and aesthetics as a result of their remodel.
"The pandemic has changed the way we use our homes, and many of those changes are here to stay," said Lautz. "As a result, homeowners needed to reconfigure or remodel how they use their home and maximize space."
More than a third of owners (35%) hired a professional for their entire project, while 28% reported that they hired someone for the labor but purchased the necessary materials. Twenty-two percent of homeowners did the full project themselves, from start to finish.
The NAR/NARI report aimed to calculate consumers' viewpoints toward their projects upon completion. Projects that made the renovators want to remain home, or remodel jobs that sparked an increase of enjoyment among occupants, received a high Joy Score, with 10 being considered a perfect Joy Score. Some tasks that were awarded scores of 10 were as follows: painting a home's entire interior, painting one room, adding a home office, hardwood floor refinishing, closet renovation, and insulation upgrades, among other labors.
Hardwood floor refinishing received a 10 Joy Score because the homeowners felt happiness and satisfaction in their home after undertaking the upgrade. Sixty-four percent of those polled answered that they have an increased sense of enjoyment when they are at home now that their hardwood flooring is installed. Another 64% said just thinking about the completed project gives them a "major sense of accomplishment."
Adding a new home office is another task that earned a perfect Joy Score based on homeowners' sentiments. Ninety-one percent of consumers said they have a greater desire to be home now that their office is in place. Seventy-three percent said they have an increased sense of enjoyment when they are home.
The NAR/NARI report also examines numerous remodeling tasks and provides a cost recovery estimate for the projects. The genuine cost of each remodeling project and cost recovery are influenced by many factors, including project design, quality of materials, location, age and condition of the home, and homeowner preferences.
"Quite often, an added benefit to home renovations is the possibility of an increase in the home's value, which is a reason why some people remodel," said Lautz. "This is especially advantageous to a homeowner who may be considering selling their house or converting the home to a rental property."
Realtors® provided an estimate of the likely dollar value each project would add to a house during resale. In comparing that dollar value to the estimated cost of each job provided by NARI members, a Recovered Project Cost percentage was tabulated. In regard to interior projects, the highest percentage cost recovered was from refinishing hardwood floors at 147%. New wood flooring was at 118%, and an insulation upgrade was at 100%. Among exterior projects, new roofing and a new garage door both recovered 100% of the project costs.
Kitchen upgrades were also popular among homeowners, with the task receiving a 9.8 Joy Score. The top reason (32%) to take on a kitchen overhaul was the desire to upgrade worn out surfaces, finishes or materials. The second top reason (20%) was to add features and improve livability.
According to NARI remodelers' cost estimate, the average kitchen remodel would be about $45,000. Realtors® estimated that $30,000 of that sum could be recovered as a result of the renovation. That would be a 67% recovery rate.
About NAR's and NARI's Survey
In autumn of 2021, homeownership site HouseLogic.com surveyed consumers regarding the last remodeling project they undertook. A total of 1,182 respondents took the online survey. The Joy Score was calculated by combining the share who were happy and those who were satisfied when seeing their completed project and dividing the share by 10 to create a ranking between 1 and 10. Higher Joy Scores indicate greater joy from the project.
Also, in autumn of 2021, NARI emailed a cost survey to its 5,778 members. A total of 210 responses were received. The survey had an adjusted response rate of 3.6%. Respondents were asked to consider certain parameters when assessing the cost.
In February 2022, NAR emailed remodeling project surveys to a random sample of 95,921 members. A total of 4,792 responses were received (see report for full methodology).
The National Association of Realtors® is America's largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industries.
# # #
Post a Comment