Home improvement is a huge industry, which encompasses the sale of building materials and decor as well as the labor and services that contractors, tradespeople and others offer to help homeowners renovate or improve their homes. It has seen excellent growth results in recent years, especially during the COVID-19 pandemic, when more people were spending time at home and focused on DIY projects that might have otherwise been left to professionals.
However, with the end of the pandemic in sight and rising prices on everything from food to gasoline, many consumers may be putting off big renovations or at least considering lower-cost options that will make their homes more comfortable without blowing their budgets. That’s what the two largest home improvement retailers are seeing. Both Lowe’s and Home Depot report a slowdown in sales of kitchen and bathroom remodeling jobs, though both report that customers still want to improve their homes.
In fact, homeowners are planning to spend $7,746, on average, on projects this year. But the majority say they’re not doing so for resale value. They’re mostly looking for comfort and satisfaction.
The best way to determine what improvements are worth the cost is to work with a real estate professional, especially one who’s familiar with your area. He or she can help you prioritize the most important areas to improve and give you a good idea of what kind of return you’ll get if you decide to sell in the future.
It’s also important to consider your own needs and desires when deciding on home improvements. For example, if you’re a family with young children, adding an extra bedroom and bath is an excellent way to increase your living space and add value to your home. That’s a project that will likely pay off when it comes time to sell.
But don’t go overboard with improvements that are too personalized or out of line with the style of the neighborhood. Too much customization can actually detract from a home’s value and reduce the number of prospective buyers.
Another mistake is to put yourself in debt to finance a home improvement project. That’s never a smart move, and it can be especially risky if you plan to sell soon. Unless you’re in an incredibly hot market, a hefty mortgage can hold back your selling price.