Navigating the Home Improvement Market Given the June 2023 U.S. Size of Home Improvement Market Forecast

Whether your role lies in inform­ing tar­get­ed mar­ket­ing cam­paigns, dri­ving prod­uct devel­op­ment or ana­lyz­ing con­sumer insights, stay­ing ahead of mar­ket trends and eco­nom­ic shifts is cru­cial for mak­ing strate­gic deci­sions. To aid your efforts, ana­lysts for the Home Improve­ment Research Insti­tute 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:

The Current Home Improvement Products Market Outlook

The June 2023 update to the U.S. Home Improve­ment Prod­ucts Mar­ket Fore­cast reveals a nuanced pic­ture of the industry’s per­for­mance. While the over­all out­look for growth has been adjust­ed slight­ly since the last iter­a­tion of the report, it’s essen­tial to under­stand the fac­tors con­tribut­ing to these changes.

HIRI Mem­bers will have access to the Sep­tem­ber 2023 update to the size of mar­ket fore­cast in September.

Key Figures

In nom­i­nal dol­lars, home improve­ment prod­ucts growth pro­jec­tions for 2023 have been adjust­ed from 1.3% in the March report to a neg­a­tive 0.9%.

Con­sumer mar­ket sales are expect­ed to decrease by 0.1% com­pared to the pre­vi­ous five-year period.

Pro­fes­sion­al mar­ket sales are also pro­ject­ed to decrease by 2.6% com­pared to the pre­vi­ous five-year period.

Remem­ber that growth in the home improve­ment mar­ket peaked in 2021, so today’s neg­a­tive growth rates are noth­ing to be alarmed about and there are key mar­ket dri­vers enabling a resilient out­look for home improve­ment. Although spend­ing may be eas­ing slight­ly, the mar­ket is still per­form­ing quite well, espe­cial­ly com­pared to his­tor­i­cal figures.

Real dis­pos­able income is antic­i­pat­ed to grow by 3.6% in 2023, sur­pass­ing the 2.6% that was pro­ject­ed in the pre­vi­ous report. This growth in dis­pos­able income can poten­tial­ly dri­ve con­sumer spend­ing on future home improve­ment projects.

Pros Taking the Lead

One note­wor­thy trend high­light­ed in the U.S. Home Improve­ment Prod­ucts Mar­ket Fore­cast is the expec­ta­tion that pro­fes­sion­als will be the pri­ma­ry influ­encers of home improve­ment mar­ket growth over the next five years. As men­tioned pre­vi­ous­ly, the pro­fes­sion­al mar­ket is fore­cast­ed to grow by 5.0% in 2024 alone and an addi­tion­al 4.1% on aver­age from 2025 through 2027.

This pro­jec­tion stems from sev­er­al fac­tors and is bol­stered by a pos­i­tive sen­ti­ment among con­trac­tor firms and a focus on sound sales prac­tices found in HIRI’s Con­trac­tor Top­ic Study.

The data sug­gests that more firms are expe­ri­enc­ing pos­i­tive out­comes com­pared to a year ago, with a high­er num­ber believ­ing they will do even bet­ter in the com­ing months. This con­fi­dence is more pro­nounced among larg­er firms. Addi­tion­al­ly, pro­fes­sion­als, par­tic­u­lar­ly at small­er firms, are adapt­ing to shifts in the econ­o­my by hon­ing their sales strate­gies to address weak­en­ing demand.

Merchandise Lines on the Rise

The U.S. Home Improve­ment Prod­ucts Mar­ket Fore­cast iden­ti­fies the top 10 fastest-grow­ing mer­chan­dise lines for both con­sumers and pro­fes­sion­als. These insights can help you align your prod­uct offer­ings with cur­rent mar­ket demand.

Top 10 Fastest-Growing Merchandise Lines for Consumers

1. Soft-sur­face floor coverings

2. Elec­tri­cal supplies

3. Hard-sur­face floor coverings

4. Lawn and gar­den equip­ment and supplies

5. Nurs­ery stock and soil treatments

6. Paint sun­dries and oth­er supplies

7. Oth­er build­ing materials

8. Roof­ing and supplies

9. Paint and preservatives

10. Tools

Top 10 Fastest-Growing Merchandise Lines for Professionals

1. Elec­tri­cal supplies

2. Hard-sur­face floor coverings

3. Roof­ing and supplies

4. Lawn and gar­den equip­ment and supplies

5. Paint sun­dries and oth­er supplies

6. Gyp­sum and spe­cial­ty boards

7. Nurs­ery stock and soil treatments

8. Soft-sur­face floor coverings

9. Paint and preservatives

10. Oth­er supplies

HIRI mem­bers receive access to the full U.S. Home Improve­ment Prod­ucts Mar­ket Fore­cast:

The study includes:

• Prod­uct cat­e­go­ry – lev­el infor­ma­tion for both the con­sumer and pro­fes­sion­al mar­ket, includ­ing the dol­lar amount of sales for each prod­uct cat­e­go­ry and a cor­re­spond­ing year-over-year comparison

• Geo­graph­ic detail for the nine cen­sus divi­sions, show­ing, for exam­ple, eco­nom­ic growth and slow­down rates as well as future fore­casts by region

• Eco­nom­ic infor­ma­tion such as con­sumer spend­ing, sav­ing, invest­ment, mort­gage rates and employ­ment information

For full access to the report and oth­er pro­pri­etary research, join HIRI today.

Attend the Annual HIRI Summit to Keep Ahead of Market Changes

The hous­ing and home improve­ment mar­ket con­tin­ues to change rapidly.

If your brand is to stay rel­e­vant to Pros and DIY­ers while main­tain­ing and gain­ing mar­ket share, you and your team must keep your minds sharp to cur­rent indus­try trends and cus­tomer behaviors.

HIRI’s Home Improve­ment Insights Sum­mit is the pre­mier event deliv­er­ing the lat­est insights into con­sumer and pro cus­tomers atti­tudes, dis­tri­b­u­tion chan­nel shares, and hous­ing macroeconomics.

You’ll be hear­ing from experts in the indus­try who will be bring­ing to you research-based guid­ance for under­stand­ing mar­ket dri­vers, fore­see­ing changes, and dri­ving prod­uct and ser­vice strat­e­gy and innovation.