Remodeling contractors specialize in making substantial improvements, alterations, or additions to the interiors or exteriors of existing buildings. Unlike general contractors who oversee entire construction projects, remodeling contractors typically concentrate on specific areas or tasks, such as kitchens, bathrooms, room layout changes, home additions, or deck and patio construction. While they occasionally handle commercial real estate projects, the majority of their work is on owner-occupied residential properties.
According to Washingtonian, although many industries experienced economic hardships during the COVID-19 pandemic, some sectors thrived. For remodeling contractors, the unique dynamics of the pandemic economy brought increased business. People were motivated to make various household improvements as they spent more time in their homes than ever.
This shift led to a 25% increase in residential construction during the pandemic years.1Â Further evidencing this trend, the remodeling industry saw spending on home improvements and repairs grow by 3% in 2020, despite the overall U.S. economy shrinking by 3.5% during the same period.2Â This trend gained steam, peaking in 2022 when spending on home remodeling surged by 16%.3
Moving forward, the remodeling market will continue to be driven by several factors. For example, homeowners continue to have record levels of home equity to support financing renovations. Additionally, energy-efficient retrofits incentivized by the Inflation Reduction Act of 2022 and property repairs prompted by Hurricane Ian will further support growth in the coming year.