As the economy continues to soar and home values increase in most major markets, home renovation projects are gaining steam. In fact, one study suggests that Americans are set to spend 7.5 percent more on home remodeling this year than last year. But what are we spending our money on?
Home Remodeling Budgets Soar
Americans households are expected to spend nearly $340 billion this year to remodel or renovate their homes, a 7.5 percent year-over-year increase, a recent report by the Joint Center for Housing Studies of Harvard University explains.
For perspective, the $340 billion expected to be spent on home remodeling is the most in more than a decade – a sign that the economy is continuing to recover in the wake of the recession.
“Steady gains in the broader economy, and in home sales and prices, are supporting growing demand for home improvements,” says Chris Herbert, managing director of the Joint Center for Housing Studies. “We expect the remodeling market will also get a boost this year from ongoing restoration efforts in many areas of the country impacted by last year’s record-setting natural disasters.”
The average cost of a home remodel depends on a number of factors, including the room, location, materials, and full extent of the renovation or upgrade. Research from Home Advisor shows that the average kitchen remodel comes in at $20,474 in 2018, while bathrooms average somewhere between $6,000 and $14,000. When it comes to adding square footage to a home, the average cost is $40,915.
2018’s Top Home Renovation Trends
Americans are spending more – but what are they spending it on? As is the case each year, trends come and go. In 2018, here are a few of the top home remodeling trends around the country.
- Livening Up the Kitchen
The kitchen is always one of the hottest rooms to remodel. Not only does it get the most use, but it also has a bigger impact on a home’s value than any other room in the house.
“Over the last several years, grey and white have been the most popular color schemes for modern kitchens. While these colors look like they are here to stay, there is a growing trend towards throwing in bold, beautiful, and colorful accents to brighten up the look of any-size kitchen,” explains Kitchen Cabinet Kings. “To get your feet wet with adding a pop of color, consider installing two-tone cabinets as an easy way to mix-up the look of a monochromatic area.”
As far as appliances go, black stainless steel is quickly gaining recognition in trendy circles. The contrast looks especially good in a white kitchen.
- Tearing Down Walls
“Homes up until the 1940s and 1950s employed designs where each function had its own separate room,” professional remodeler Lee Wallender writes. “The kitchen would be a separate room, living room a separate room, dining room a separate room, and so on.”
After World War II, open floor plans first started to surface. As cooking become a social function in the home, houses started featuring the kitchen, family room, and dining room all in the same space. But even up until the early-2000’s, many homes still felt very compartmentalized.
Today, one of the most popular home remodeling tricks involves tearing down walls and open up space. In fact, many homeowners think they need to add square footage until they open the floor plan up and realize they have plenty of functional space.
- Luxury Basement Upgrades
“While everyone desires a finished basement, current trends are pointing to really going the extra mile with your basement remodel,” home design expert Jaclyn Crawford says. “This means more than just waterproofing and laying down some flooring, but also building out your basement to include all the amenities the rest of your home has.”
People don’t want to feel like they’re in a basement. It should be viewed as an extension of the rest of the home – not an afterthought. Kitchenettes, updated bathrooms, and ample lighting are critically important.
- Unique Surfaces and Materials
Homeowners used to play it pretty conservatively when it came to surfaces. Countertops were granite or laminate, floors were wood, carpet, or vinyl, and walls had drywall finishes. In 2018, unique surfaces and materials are stealing the show. And believe it or not, one popular material is concrete.
“It’s a really affordable, high-impact design element,” Houzz editor Mitchell Parker says. “We’re seeing new uses [of it] on all kinds of hardscaping surfaces. On anything you can think of, people are casting it.” Countertops – both in the kitchen and bathroom are really popular applications for concrete.
Accent walls are also really popular. People are using reclaimed wood, shiplap, brick, stone, and even tile. These accent walls are really cost-effective and can change the entire look of a room without needing to address every wall.
Consumer Confidence Continues to Grow
Spending on home remodels tends to closely mirror trends in the overall economy – including consumer confidence. And when you study the confidence homeowners have right now, it’s clear why spending is up.
According to the most recent report from The Conference Board Consumer Confidence Survey, consumer confidence is at its highest point since 2000. Other indices, including the Present Situation Index and Expectations Index, are also higher than they’ve been in years.
“Consumers’ assessment of current conditions was more favorable this month, with the labor force the main driver,” says Lynn Franco, Director of Economic Indicators at The Conference Board. “Despite the recent stock market volatility, consumers expressed greater optimism about short-term prospects for business and labor market conditions, as well as their financial prospects. Overall, consumers remain quite confident that the economy will continue expanding at a strong pace in the months ahead.”
While anything can change at any time, it’s exciting to see the positive effects of a healthy economy. As we look toward the coming months, it’s difficult to see anything other than an uptick in home remodels.
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