Share
Homeowners and renters remodel, redesign, and restructure their homes for a variety of reasons. This report takes a deep dive into the reasons a homeowner remodels, the outcome of taking on projects, and the increased happiness found in the home once a project is completed. It also contains:
- The typical cost of 19 remodeling and replacement projects, as estimated by members of the National Association of the Remodeling Industry (NARI)
- How much appeal each project is likely to have for buyers, according to REALTORS®
- How much REALTORS® estimate that homeowners can recover on the cost of the projects if they sell the home.
Americans spent $420 billion in 2020 on remodeling their homes.1 Among NARI members, 90% found a greater demand in contracting in remodeling work during the COVID-19 pandemic. Sixty percent of NARI members cited the scale of the projects increased either in a larger project or remodeling more than one room due to the pandemic.
While most consumers (83%) cite they would have remodeled regardless of the pandemic, 86% of consumers report remodeling one area of their home made them want to then remodel other areas of their home.
When consumers remodel, it is to upgrade worn-out surfaces, finishes, and materials (30 percent); to add features and improve livability (20%), and because it is time for a change (16%). Most consumers are pleased with the overall result and 57% would tackle the project the same way, while 35% would make a few different choices such as finishes or materials. After remodeling, 84% of owners have a greater desire to be in their home. Sixty- nine percent have increased enjoyment in their home. Fifty-seven percent feel happy, and 39% feel satisfied when they see their completed project, with a typical Joy Score of 9.6. Sixty-nine percent feel a major sense of accomplishment when they think of their completed project.
Thirty-five percent of owners report the single-most important result from remodeling is better functionality and livability, 22% report durable and long-lasting results, materials, and appliances, and 14% report beauty and aesthetics.
Thirty-five percent of the owners hired a professional for the whole job, 28% hired the labor but purchased the materials, and 22% did the entire project themselves. Thirteen percent contributed some do-it- yourself (DIY) labor. In some areas of the report, costs are not collected as these projects are more likely to be done DIY or part of a larger project.
The report covers both interior and exterior home improvement projects. This report provides a cost recovery estimate for representative remodeling projects. The actual cost of each remodeling project and cost recovery are influenced by many factors, including project design, quality of materials, location, age and condition of the home, and homeowner preferences. For the purpose of costs collected, NARI members were asked to expect the home was a 2,495 square foot house—the average size according to U.S. Census data—and that the house is a post-198-built home with no hidden issues. To ensure the most applicability, projects and materials represent standard or typical quality; a few projects feature "better-quality" materials. But there are no top-of-the-line projects.
Interior Analysis
There are many ways for homeowners to approach remodeling projects and even more ways to analyze the projects' successful outcome.
NAR calculated a Joy Score for each project based on the happiness homeowners reported with their renovations. There were numerous interior projects that received a perfect Joy Score of 10: paint entire interior of home, paint one room of home, add a new home office, hardwood flooring refinish, new wood flooring, closet renovation, insulation upgrade, and attic conversion to living area. While some are DIY projects, an attic conversion is one of the most expensive projects to undertake.
REALTORS® provided an estimate of the likely dollar value each project would add to the house at resale. In comparing that dollar value to the estimated cost of each project provided by NARI members, a Recovered Project Cost percentage was calculated. For interior projects, the highest percentage cost recovered was from refinishing hardwood floors at 147%, new wood flooring at 118%, and insulation upgrade at 100%.
Exterior Analysis
There are many ways for homeowners to approach remodeling projects and even more ways to analyze the projects’ successful outcome.
A Joy Score was calculated for each project based on the happiness homeowners reported with their renovations. Exterior projects with the highest Joy Scores were for painting exterior siding, new vinyl or wood windows, and new steel or fiberglass doors. In comparison, to interior projects, no project received a perfect Joy Score of 10.
REALTORS® provided an estimate of the likely dollar value each project would add to the house at resale. In comparing that dollar value to the estimated cost of each project provided by NARI members, a Recovered Project Cost percentage was calculated. For exterior projects, the highest percentage cost recovered was from new roofing and new garage door both at 100%. Fiber cement siding recovered 86% of the cost spent and vinyl siding recovered 82%.
1 Improving America's Housing, Joint Center for Housing Studies at Harvard University, 2021.
