Inflation, labor shortages threaten the remodeling industry
According to the Improvement of American housing 2025 reportThe power of the renovation industry has long been supported by the aging of both houses and households, as well as high real estate values. But more investments are needed to tackle the growing demand for energy efficiency and disaster resilience.
Data from the report indicates that home improvement and repair expenditure is accelerated from $ 404 billion in 2019 to $ 611 billion in 2022. It is expected that it is expected that $ 600 billion to 2025 are expected to remain.
Roofing, windows and heating, ventilation and air conditioning (HVAC) accounted for 49% of the improvement expenditure in 2023, the most recent available data. The average homeowner spent almost $ 4,700 in improvements that year.
Looking at the repair and renovation market through a demographic market, JCHS discovered that households led by a person of color more contribute to the market for improving home improvement. They accounted for 23% of improvement spending, an increase of 14% in 2003. Immigrants homeowners are also good for a growing share of the market, an increase of 8% of expenditure in 2003 to 13% in 2023.
JCHS discovered that in 2023 homeowners aged 65 and over 27% of the total improvement expenditure contributed, an increase of 14% in 2003.
In the past two decades, the number of homeowners aged 65 and older has increased by 12 million, which increased their share of all homeowners from 24% to 34%. During the same period, their average annual expenditure per owner of inflation that had adjusted $ 1,800 in 2003 to $ 3,800 in 2023 in 2023 rose double the 48% growth in expenditure per head of the population among all homeowners.
At the same time, the housing stock of the nation, with a median age of 44 years in 2023 – is aging a sign of required reinvestment. Houses built before 1980 saw the average improvement spending that were 24% higher than for houses built since 2010, and the maintenance spending was 76% higher. Many homeowners with a low income live in the house with structural shortcomings or a lack of basic characteristics such as running water, electricity or heat.
“There is both a market opportunity and a moral need to expand improvement and repair services for these homeowners,” said Sophia Wedeen, a senior research analyst at JCHS. “More financing tools and counseling programs can also help to maintain the affordable housing stock and ensure that all households live in safe and adequate housing.”
Modern worries
The growing frequency and intensity of climate -related events such as hurricanes, forest fires and floods have increased the expenditure for disaster -driven repairs to $ 49 billion in 2022 and 2023. As a result, the average insurance premium of homeowners increased between 2021 and 2023, the report found.
In 2023, homeowners also spent $ 139 billion on improvements on impact on home energy consumption, almost four times the amount in 2003.
“Every energy-related improvement offers the possibility to reduce greenhouse gas emissions, increase the efficiency of the housing stock and lower the utility costs,” said Carlos Martín, director of the Remodelleringsfutures program at JCHS.
Labor shortages are a different obstacle to the repair and renovation companies. The study showed a “fragmented” remodeling industry with large shares of the self -employed.
In the aftermath of recent tariff proposals and plans to deport immigrants without papers, JCHS foresees that industry will be impeded by the high costs of building materials and labor deficits. Between 2015 and 2023, a majority of renovators reported a shortage of skilled commercial workers – including carpenters, electricians and plumbers.
The industry is also highly dependent on immigrants, which in 2023 was good for 34% of the construction power of construction.
“Given the strong basis and the growing needs, the renovation of residential associated with the coming years will be a formidable economic sector,” said Chris Herbert, director of the JCHS. “And despite unparalleled expenses in recent years, much more investments are needed to improve energy efficiency, disaster resistance and accessibility for the 145 million houses in the country.”
