During the pandemic, home remodeling surged. People were spending a lot more time in their homes and began to notice things that needed an upgrade.
Remodeling contractors stayed busy in 2020 and 2021 and offered homeowners very few discounts. But that may be changing in 2023.
A new report from the Harvard Joint Center for Housing Studies (JCHS) predicts home improvements and repairs – everything from an updated bath to a new roof – will grow only modestly this year.
The center’s Leading Indicator of Remodeling Activity (LIRA) projects a steep deceleration in annual gains of home renovation and maintenance spending from 16.3% at the close of 2022 to just 2.6% by year-end 2023.
“Slowdowns in existing home sales, house price appreciation, and mortgage refinancing activity coupled with growing concerns for a broader economic recession will cool home remodeling activity this year,” said Carlos Martín, project director of the Remodeling Futures Program at the center. “Homeowners are likely to pull back on high-end discretionary projects and instead focus their spending on necessary replacements and smaller projects in the immediate future.”
Opportunity for homeowners?
If that’s the case it could present an opportunity for homeowners who have put off tackling a major remodeling project. Not only could contractors be more available, but they could also be more accommodating on price.
Bathroom and kitchen upgrades tend to add the most value to a home but they can also be among the most expensive projects. When upgrading a bathroom, the ConsumerAffairs research team says it’s crucial to hire a contractor who can follow a timeline and stay on budget.
Our experts suggest casting a wide net, making a list of 10 to 15 local contractors who have the right expertise. You’ll probably whittle that list down before asking for bids.
Ask friends who have recently remodeled a room in their home for recommendations and advice. And of course, check out reviews.
Be leery of contractors who can’t provide complete transparency, And be cautious of home improvement contractors who don’t have basic information and resources available, such as a website, a social media presence and reviews.