The United States remodeling market soared above $600 billion from the home improvement boom that rode the pandemic. Despite recent softening, is still remains 50% above pre-pandemic levels. However, industry fragmentation, inflation and a shortage of skilled trade labor jeopardize the ability of the industry to fully meet demand. According to Improving America’s Housing 2025, a recently released report from the Harvard Joint Center for Housing Studies (HJCHS), the resilient strength of the remodeling market has been supported by the aging of homes and households, as well as record-high property values, but far more investment is needed to address growing needs for energy efficiency and disaster resilience of the country’s 145 million homes.
According to the report, Home improvement and repair spending vaulted from $404 billion in 2019 to $611 billion in 2022, and is expected to remain above $600 billion through 2025. Homeowners remain focused on replacement projects such as roofing, windows, and HVAC, accounting for 49 percent of improvement expenditures in 2023. On average, homeowners spent almost $4,700 on improvements in 2023, nearly 9 percent above the previous market boom in 2007.
The growing frequency and intensity of hazard events like hurricanes, wildfires, and flooding have increased spending for disaster repairs to $49 billion in 2022–2023, an astonishing leap from $16 billion in 2002–2003. While few homeowners undertake mitigation retrofits, skyrocketing insurance premiums may provide the motivation to do so: the average homeowner insurance premium jumped 17 percent between 2021 and 2023. In 2023, homeowners also spent $139 billion on improvements impacting home energy use, nearly four times the amount in 2003. “Each energy-related improvement presents an opportunity to cut greenhouse gas emissions, increase the efficiency of the housing stock, and reduce utility costs,” says Carlos Martín, Director of the Remodeling Futures Program at the Center.
