With new remodeling market data available, it’s time to recalibrate building product marketing strategies for a new remodeling market trajectory.
Marketers of building materials for the remodeling industry faced early 2020 as an enigma. There were no reference manuals on how the remodeling market behaves during a pandemic. With households required to stay-at-home, and many both working and schooling their children from their homes, it forced homeowners into a lifestyle that may have proven their current homes inadequate. There were open questions that could re-define the home remodeling market:
No doubt a cultural change took place in 2020 — while there will be an end to the pandemic, I believe many elements of that cultural change and how we view and use our living space will remain. So how will that affect the home repair and remodeling market with respect to who does the remodeling, and what remodeling activities are undertaken?
For decades, Home Innovation has been tracking the DIY and Pro segments of the remodeling market, which has repeatedly demonstrated that it is non-linear and responds strongly to economic and demographic conditions. Data from our 100,000-respondent Consumer Practices Survey over the past 25 years show that younger households are more likely to undertake a DIY project, and that economic uncertainties (e.g., recessions and equity market meltdowns) are associated with an increasing share of DIY projects compared to those undertaken by a professional contractor.
For example, the Pro segment grew sharply during the housing market boom in the early 2000s, but fell during the great recession, bottoming out in the late 2000s. Since then, the Pro segment has expanded at the expense of the DIY segment — a reflection of economic prosperity and the gradual aging of households.
Do does the past dictate the unique future we now face? Fortunately, our 2021 Consumer Practices Survey has just returned from the field and its 40 standard reports are being finalized now. This allows us to ascertain the trajectory of markets so the industry can calibrate its marketing efforts to address the post-pandemic reality. The graph below compares the percent of total remodeling projects undertaken in 2020 that were do-it-yourself to those in 2018. Categories are ordered, top to bottom, by greatest percentage point increase in DIY activity.
Source: Home Innovation's Annual Consumer Practices Survey
It’s important to note that these expansions and contractions of the DIY market do not happen equally across all remodeling project categories. Where danger is high, such as in roofing replacements, or where special skills or equipment is needed, such as fabricating countertops, the DIY market share is fairly inelastic and is not impacted by economic climate. Others, with shorter learning curves and fewer tools and equipment requirements, such as painting and interior doors, saw the greatest jump in DIY share last year, giving indication of their market elasticity.
Where Does it Go from Here?
Based on our early look at the data, there was a rush at the beginning of 2020 to address neglected repairs and upgrades, such as painting and gutter replacements. There was also an early rush to declutter, which particularly benefitted the market for garage and pantry storage systems and the construction of storage buildings. Soon after, there was a boost in outdoor living projects — decks, patios, porches, fences, and outdoor kitchens — to take advantage of warmer weather, maximize living and entertaining spaces, and provide a place to socialize while maintaining social distance.
The pandemic is still with us, but we have clues that the market has begun more solidly shifting to address our lifestyle changes by households adding or reconfiguring living space. This type of remodeling — additions, conversions, and interior wall reconfiguring — is more often done by professionals so it bodes well for contractors servicing the home remodeling industry.
In the coming weeks, we’ll be digging deeper into the new Consumer Practices Reports data, so stay tuned to our Trends articles and Blogs. We’ll be addressing how the pandemic resulted in changing popularity of different styles and materials, its impact on labor-intensive remodeling activities, and regional variations in markets.
If you are considering subscribing to our Consumer Practices Reports, contact us as quickly as possible to arrange it. As we prepare and publish our 40 remodeling reports and 50 new home construction reports, we make them available principally on a first-come, first-serve basis. Consumer Practices Reports are being published in early February this year. Contact us today to discuss.