A decade after the financial recession, new home construction has been relatively slow – meaning that American homes are aging and, as a result, homeowners are spending more money on renovations.
A new report released by Harvard University's Joint Center for Housing Studies found that in 2017, Americans spent a whopping $ 425 billion on home improvement, a record; this represents an increase of 10% over 2015 and a jump of more than 50% compared to 2010.
Boomers owe a great deal of their gratitude to the resumption of home renovations; by the time they start to turn 70 or 80, this generation is starting to spend more on investments to improve accessibility, so they can stay at home instead of settling elsewhere. .
"Homeowners aged 55 and over have dominated the home improvement market for almost 10 years, outperforming middle-aged homeowners as the primary source of home improvement spending," the report says. "Older homeowners are living longer and are becoming more willing and able to spend on home improvements that will keep them safe in their current homes."
The study found that total spending by older homeowners has increased more than 150% over the decades, reaching $ 117 billion. By comparison, total market expenses increased by only 9% among homeowners under 35 years of age. Nearly 3 million homeowners reported undertaking projects that would improve accessibility for seniors and people with disabilities.
A majority of owners – 77% – reported funding these projects using cash from savings. About 5% reported using credit cards or retail cards.
However, there is a strong correlation between rising house prices and home improvement expenditures. Because houses are more expensive, fewer people change their residence. The national mobility rate has almost halved in the last four decades.
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In areas such as Boston, Dallas, San Francisco, Seattle and San Jose, homeowners typically spend more on home improvements than city owners who have not fully recovered from the recession, such as Miami, Las Vegas or Phoenix.