More homeowners say they plan to renovate their homes this year, and they are increasingly planning to take advantage of higher home prices and use their home’s equity to complete the renovations, according to Bank of America’s “2021 Homebuyer Insights Report: Home Improvement and Equity Spotlight.”
As home prices surge, more homeowners are tapping HELOCs to make significant home improvements. Gen X homeowners (ages 44 to 56) are the most likely to report using HELOCs for home improvements, the survey finds.
“Greater reliance on the home as both a workspace and a family center has led many owners to tailor their homes to their needs,” the report says.
The majority of respondents said they’re approaching their home improvements as a way to bring greater enjoyment to their living space (67%)—more so than seeking to increase their home’s value (33%). “Traditionally, home improvement projects have been measured through the lens of return on investment, but we’re seeing that the emotional connection to one’s home is just as important,” says Ann Thompson, specialty lending executive at Bank of America.
The survey uncovered several trends with home improvement projects, including:
- Greater modernization: Many homeowners are taking on home improvement projects because they want to bring their homes up to date or need to replace dated areas of their homes. The median age of a U.S. owner-occupied housing stock is 39 years, according to the National Association of Home Builders.
- Fixer-uppers are OK: About 42% of younger home buyers surveyed say they would prefer to buy a fixer-upper and improve it over time than to purchase a home that’s move-in ready.
- DIY is trending: Many homeowners are taking a do-it-yourself approach to some of their smaller house projects, such as painting or upgrading hardware and fixtures. Fifty percent say they’ve learned how from watching videos. Nearly 40% say they were inspired by TV shows such as HGTV to do more DIY projects in their home. Younger adults are the most likely to do DIY. Nearly three-quarters of younger homeowners between the ages of 18 to 43 say they’ve completed DIY work around their house.
- Sustainability is important: Younger generations tend to value sustainability features the most. Half of younger generations want to add solar panels (51%) and energy-efficient appliances (48%). On the other hand, only one-third of older generations want to add solar panels (33%) and energy-efficient appliances (36%).