Dive Brief:
- Online home remodeling source Houzz released its second-quarter 2016 Renovation Barometer report and said while home remodeling industry confidence is still high, Barometer readings of 63-78 reflect a "slight weakening" in design-related services from last quarter (70-78) as well as from the second quarter of 2015 (75-80).
- Renovation firms (50% or more) reported that the greatest increase in renovation projects came from older homeowners, led by the Generation X demographic ages 35-54, while more than 33% of firms reported an uptick in projects initiated by baby boomers, those 55 and older.
- On the project side, more than 33% of renovation firms reported that clients are increasingly selecting more expensive products to use in their projects, while more than 25% of firms said homeowners are taking on more than one renovation project at a time. Renovation firms reported upticks in kitchen and bathroom remodels, aging-in-place improvements and more energy efficiency, green and smart home installations.
Dive Insight:
The Houzz Renovation Barometer is a survey of firms active in the renovation industry, and the higher the reading is over 50, the more firms there are reporting increases in business activity rather than decreases. The Barometer, said Houzz has shown six straight quarters of confidence and that regional renovation activity echoes national trends, with the exception of the Northeast, which fell 14%.
This quarterly report somewhat contradicts a June report from Houzz that suggested millennials were just as likely to start a renovation project than any other age group, since less than 30% of firms this quarter reported growth from this demographic.
Reflecting a similar, slight weakening was the latest National Association of Home Builders/Wells Fargo Housing Market Index report. All three aspects of the Index declined – builder perceptions of single-family home sales (-1 point), sales expectations for the next six months (-1) and traffic of prospective buyers (-3) – to deliver a total decrease to the Index of one point. While still representative of growth, the NAHB said the increased costs of land and regulation, combined with a shortage of labor was causing the Index's downward movement
