Hometown Impact: How Local Housing Markets are Impacting Home Improvement Activity
Even still, consumer spending for nursery stock and soil treatments, as well as lawn and garden equipment and supplies, continues to decrease in 2023—a trend that started in 2022. However, both of these market segments are expected to recover over the next few years. Watch for our upcoming 2023 Product Decision Study, which will be released to HIRI members by November 2023.
HIRI research shows that, for DIY homeowners, the markets pertaining to bathroom remodeling projects—plumbing fixtures and supplies, as well as bath cabinetry and countertops—are expected to decline in 2023 and 2024, with growth rebounding 2025 through 2027.
The most striking transformation in the home improvement industry has been a strong push towards online sales, now representing 37% of the total home improvement market. This has allowed generalist giants like Amazon, Walmart, and Costco to challenge industry specialists like Home Depot and Lowe's for industry market share.
From HIRI’s Q2 2023 project activity report, we see 2 quarters of growth following a low in Q4 of 2022. Complementing this equity is historically low unemployment rate and above average wage growth.
HIRI recently released its latest iteration of the U.S. Home Improvement Products Market Forecast, offering valuable insights into the state of the industry and the broader economic landscape. Here's what we know:
A staggering 73% of survey respondents stated that there is a labor shortage within the construction industry. However, only 42% of these respondents perceived a shortage of labor within their own companies. Dave King, HIRI’s executive director, noted that this reveals the industry’s widespread perception that labor shortages are affecting everybody, while the number of firms affected in reality may be much lower.
Throughout 2022 and 2023, consumer sentiments have been low and the result has been postponement of larger home improvement and remodeling projects. As we look towards 2024, with economic uncertainty easing, home improvement spend is also anticipated to resume.