If home renovations are on your radar in the near future, we thought you would enjoy hearing about the latest findings of the fourth annual Houzz & Home 2015 Survey, specifically the Houzz Renovation Considerations Index. Over 260,000 homeowners and renters around the world shared their views on renovation projects they worked on in 2014 and their plans for 2015. The index tracks the level of importance that homeowners assign to eight commonly cited renovation considerations, including: design, functionality, resale value, energy efficiency, costs, health, sustainable materials and smart technology.
It was interesting to learn how this year’s index values indicate a sharp variance of the considerations among homeowners. Topping the scale was design and functionality, with resale value, energy efficiency and costs coming in closely behind. Among these five factors, the majority of homeowners said they were “very-to extremely important” (62%-91%) compared to only a small percentage deeming them “unimportant” (1%-6%). Interestingly, in comparison, homeowners were more divided on the importance of health, green and technology-related considerations, with 25%-45% considering them as “critical” to renovations compared to 19%-30% considering them “entirely unimportant.”
The Impact of Income and Age on Resale Value
The impact of income and age on the importance of resale value and minimizing renovation costs was both expected and surprising. Minimizing renovation costs was a critical factor among 75% of homeowners with an annual income of $50K or less, compared to 39% of homeowners with incomes of $500K or more. Surprisingly, two-thirds of homeowners revealed improving the resale value of their homes to be “very to extremely important,” regardless of income levels.
When considering the net worth of U.S. households among all income levels, home equity ranked as the largest contributor. The majority of homeowners at almost all income levels are likely to view renovations as two-fold: as improvements to the style and functionality of their homes and increasing the value of their largest asset.
Improving Resale Value is Important to Millennials
Homeowners between the ages of 25-34 have been coined as Millennials. It is likely that this younger generation will rate minimizing costs and improving resale value as somewhat more important than older homeowners who are 65 years of age or older. Surprisingly, these findings were consistent across all income levels. It’s not surprising, since Millennials carry a larger debt burden and day-to-day expenses from student loans and young children when compared to “Boomers” (or older homeowners). This comparison explains the differences in the importance of minimizing renovation costs. Millennials are also more likely to move than Boomers, lending to the importance of resale value.
Home Energy Efficiency & Sustainability
When it comes to health and green/sustainable products, the study revealed that the importance of both of these factors increases as income declines. It’s no surprise that Millennials score health-related considerations higher and environmental considerations lower than Boomers, since Millennials are more health-oriented during home renovations than the older generation. This makes sense since Millennials are likely to be young parents (with 44% having minors living with them), compared to 6% of Boomers. Millennials are also more likely to have older, more problematic homes and have less time to deal with health hazards in their houses than Boomers do. With 83% of Millennials who moved in the past five years versus 25% of Boomers in the same time frame, we can see why the younger generation is less likely to integrate green and sustainable products and materials into their homes so early in the homeownership game.
Improving and maintaining home energy efficiency has been a priority for homeowners at all income levels for quite some time. Installing energy-efficient appliances, windows, doors and insulation have become the norm, but little is still known about the importance of smart technology when it comes to home renovation. The study reveals that smart technology is increasingly more important for higher income households and less for others. It is likely that as smart technology becomes more affordable, the demand and interest for it will increase.
We hope you’ve found these findings useful. Granite Transformations wishes you a happy and safe summer. We look forward to meeting your kitchen and bath renovation needs. Schedule a free in-home consultation today and receive a free quote on your next kitchen or bath remodel.