NAR joined the Remodeling Industry and found a perfect “Joy Score” by owners after painting, adding a home office, installing hardwood or renovating closets.
WASHINGTON – U.S. homeowners embark on a wide variety of renovations and remodeling projects over the past year, according to new findings in the 2022 Remodeling Impact Report, a joint study from the National Association of Realtors® (NAR) and the National Association of the Remodeling Industry.
The report analyzes a number of home improvement aspects, including why people decide to remodel, the general costs of specific remodeling tasks, and the fulfillment experienced after completing a successful project.
“Our study revealed that homeowners tend to undertake a remodeling project for any number of reasons,” says Jessica Lautz, vice president of demographics and behavioral insights at NAR. “In some instances, homeowners were content with sprucing up a room with a simple paint job, while in other cases, families decided to take on the task of renovating an entire attic or basement to add additional living space to their home.”
Americans spent $420 billion in 2020 on home remodeling ventures, and 90% of NARI members cited a greater demand for contracting remodeling work during the pandemic. Three out of five NARI members – 60% – said the scale of the projects grew during the pandemic, either into a larger project or remodeling more than one room.
“This report is the first one to measure the impact of the pandemic on the price and relative value of various remodeling projects,” says Chris Egner, president of NARI.
Although 83% of consumers said they would have remodeled regardless of the pandemic, 86% said one successful remodeling job inspired them to remodel other areas of the house.
35% of owners said the most important result from their remodel was better functionality and livability; 22% they had durable and long-lasting results, materials and appliances; 14% said beauty and aesthetics.
“The pandemic has changed the way we use our homes, and many of those changes are here to stay,” says Lautz. “As a result, homeowners needed to reconfigure or remodel how they use their home and maximize space.”
More than a third of owners (35%) hired a professional for their entire project, while 28% hired someone for the labor but purchased the necessary materials. Twenty-two percent of homeowners did the full project themselves, from start to finish.
The NAR/NARI report aimed to gauge consumers’ viewpoints toward their projects after completion. Projects that made the renovators want to remain home, or remodel jobs that sparked an increase of enjoyment among occupants, received a high Joy Score, with 10 being considered a perfect Joy Score.
Some tasks awarded scores of 10 were painting a home’s entire interior, painting one room, adding a home office, hardwood floor refinishing, closet renovation, and insulation upgrades.
Hardwood floor refinishing received a 10 Joy Score because homeowners felt happiness and satisfaction after the upgrade: 64% said they have an increased sense of enjoyment when they are at home now, and another 64% said thinking about the project gives them a “major sense of accomplishment.”
A new home office is another task that earned a perfect Joy Score: 91% said they have a greater desire to be home now that their office is in place, and 73% have an increased sense of enjoyment when they’re home.
Boosting a home’s value
The NAR/NARI report also examines numerous remodeling tasks and provides a cost recovery estimate for the projects.
“Quite often, an added benefit to home renovations is the possibility of an increase in the home’s value, which is a reason why some people remodel,” says Lautz. “This is especially advantageous to a homeowner who may be considering selling their house or converting the home to a rental property.”
Realtors provided an estimate of the likely dollar value each project would add to a house during resale. In comparing that dollar value to the estimated cost of each job provided by NARI members, a Recovered Project Cost percentage was tabulated.
In regard to interior projects, the highest percentage cost recovered was from refinishing hardwood floors at 147%. New wood flooring was at 118%, and an insulation upgrade was at 100%. Among exterior projects, new roofing and a new garage door both recovered 100% of the project costs.
Kitchen upgrades were also popular among homeowners, with the task receiving a 9.8 Joy Score. The top reason (32%) to take on a kitchen overhaul was the desire to replace worn out surfaces, finishes or materials. The second top reason (20%) was to add features and improve livability.
According to NARI remodelers’ cost estimate, the average kitchen remodel would be about $45,000. Realtors estimated that $30,000 of that sum could be recovered as a result of the renovation – a 67% recovery rate.
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