Many homeowners today are spending tens of thousands of dollars remodeling and renovating their homes purchased during the pandemic.
According to a report by Houzz, the median amount spent by homeowners on renovations last year was $22,000.
The amount spent was up 22% from last year, when homeowners typically spent $18,000 on remodeling.
Nearly 3 in 5 homeowners had remodeled or decorated last year, and nearly half made repairs, the report noted.
Some homeowners are shelling out the big bucks, it added. The share of homeowners spending $50,000 or more rose in 2022, the report noted, from 26% in 2021 to 32% last year.
“The share of homeowners spending $50,000 or more rose in 2022 from 26% in 2021 to 32% last year.”
And some are spending as much as $140,000 or more on home projects, Houzz said, at the 90th percentile.
The most popular areas that homeowners choose to renovate include the kitchen and bathroom. These areas also require the highest amount of spending. The median expense of renovating a primary bathroom was $13,500, and a kitchen, $20,000.
With 85% of homeowners having secured a mortgage rate that’s below 5%, there’s a lot of opportunity for remodeling and repair work, Eric Finnigan, VP of research and demographics at John Burns Real Estate Consulting, told MarketWatch.
Finnigan expects remodeling to cool this year, as homeowners cool off on spending amid declining home values and high interest rates. But what comes after will be big, he added, “a historic long-term remodeling boom kicks off in the second half of the 2020s,” Finnigan said.
Baby boomers, aged 55 to 74, were leading in renovation activity, followed by Generation Xers, aged 40 to 54, and millennials, aged 25 to 39.