Pandemic boom in home remodeling projects expected to continue
The market for home remodeling got its largest boost in more than 20 years, according to a study by the Joint Center for Housing Studies of Harvard University, with more than 80% of homeowners undertaking a do-it-yourself project last year.
The uptick in home remodeling during the pandemic defied the normal pattern of spending during an economic downturn, with discretionary spending usually taking a big dip.
“Spending for DIY projects had been trending down pretty steadily,” Abbe Will, senior research associate at Remodeling Futures, told Cashay. “In 2005 improvement spending for DIY projects was around 25%, so 1 in 4 dollars; that has been trending down pretty steadily over the decades down to a new low of just 17% in 2019 before the pandemic.”
Overall spending on home improvement and home maintenance has continued to grow this year, even as fewer dollars go to DIY projects. The Joint Center for Housing Studies expects Americans to spend $433 billion in 2021 on home projects — up $26 billion from before the pandemic.
“You know people were checking off projects that had built up over time, but also just reconfiguring and refreshing the home to kind of make it work better for the new circumstances with the pandemic,” Will said.
In addition to homeowners undertaking their own remodels, the market also saw a huge surge in professional remodeling services during the pandemic. While payrolls for professional residential remodelers dropped by more than 20% at the beginning of the pandemic, they have since surged past pre-pandemic levels.
“It's crazy right now, people are calling from all over the place,” said Kyle Steenberg, owner of The Electric Guys in Inver Grove Heights, Minn. “This is the first time in my life I have had to stop answering my phone. I have had more than 40 calls today alone.”
Steenberg owns a small electrical business and, since the pandemic, has been flooded with residential jobs. He is also cleaning up messes left by inexperienced DIYers who have attempted to do remodeling projects, but quickly got over their heads.
“Nine times out of 10 they don't do it right, and I mean, if things aren’t up to code you have to go get them done again,” Steenberg said.
The increased spending on home remodeling has also driven up costs. The price for a sheet of plywood has increased by more than 200% and the price of plywood has increased by almost 500% since the pandemic started, according to the National Association of Homebuilders.
Lumber prices peaked in May and are expected to continue declining in the coming months. The enthusiasm for DIY may also wane as the world gets back to something resembling normal.
“Although we haven't necessarily seen it yet,” Will said, “we don’t expect this DIY boom to necessarily be sustaining.”
Marissa is a reporter for Yahoo Money and Cashay, a new personal finance website. Follow her on Twitter @MarissaLGamache.
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