Home improvement is an industry that encompasses the sale of building materials, appliances, decor and other items that are used to improve homes. It also includes the work of contractors, tradespeople and others who perform remodeling or renovation projects. The home improvement market has reached excellent growth results in recent years. This has been mainly due to homeowners spending more on home improvements, especially during the COVID-19 pandemic.
Homeowners typically pay for home improvement projects with cash from savings, but funds for larger projects are often secured through sources like mortgage refinancing, home equity loans and contractor arranged financing. And 6% of survey respondents indicate they use “something else,” which likely refers to personal loans, borrowing from family or using credit cards.
While most homeowner projects are intended to add value and curb appeal, not every home improvement pays off. In fact, homeowners only get about 60% of the money they spend on a kitchen or bathroom renovation back when they sell their home, according to a separate Cost vs. Value report by Zonda Media.
The good news is that most homeowners say they stick to their planned budget for home repair and improvement projects, compared to 69% when we asked the question in 2018. Of course, it’s always possible that a project will turn out to be much more costly than originally expected — discovering a rotting subfloor or shoddy roofing repairs, for instance. But those surprises are usually much easier to absorb when you have a plan and the means to finance it.