Thursday, June 21, 2012

HOME IMPROVEMENTS: Forget Cost Vs. Value, Homeowners Use Improvements To Pump Up Style, Not Equity

Sure, most home improvements will hold or boost equity, even in the worst market, but today's homeowners are more concerned that improvements enhance their home's form and function rather than its value.

Homeowners also say rather than cut into their
 home improvementbudget, they are more likely to slash expenses in other areas including vacations and other big-ticket purchases, in another example of an emerging trend that finds beleaguered homeowners hunkering down to hold onto their most valuable asset by making it more their own.A new survey of homeowners planning to build, remodel or decorate in the next two years, found the vast majority, 86 percent, saying it's more important to improve their home to "improve the look and feel of the space," compared to 47 percent who say it important the work increases their home's value.

The Houzz & Home Survey, which comes with a really cool infographic of the results, analyzes remodeling and decorating project histories and plans of Houzz users in the U.S. and Canada.
The survey also examined motivations behind the projects, homeowners’ plans for hiring remodeling and design professionals or doing it themselves, and how the economy plays a role in decorating and remodeling plans.

"We expected that in this economy Americans' highest priority would be increasing home value, but instead we found people are focused on pleasing themselves, not the next owner," said Liza Hausman, vice president of marketing for Houzz.

"Homes today are doing double or even triple duty as workplace, stay-cation, gym and more," Hausman added.

Many don't have an option, according to a recent National Association of the Remodeling Industry (NARI) survey of homeowners forced to stay in their homes years longer than they originally expected because the economy ruined their plans.

NARI found, instead of sulking about their house arrest, long timers have begun to turn their cells into cozy personalized nests - homes that better reflect individual lifestyles to make them
better suited as housing for the long haul.

"Remodeling used to be about increasing resale value - making improvements that are appealing to the majority of buyers in order to boost the value of the home," said NARI National President Dean Herriges, also with Urban Herriges & Sons in Mukwonago, WI.
Not any more, as both studies reveal.

"More and more people are throwing out the resale theory and making specialized improvements that suit their needs and their needs only," Herriges added.
It's a new, practical spin on home improvements.

In the Houzz survey, 70 percent said they would rather not take out a loan for the work, but do it themselves, even those at higher income levels.

The survey found that while 45 percent of homeowners earning $150,000 or more are hiring an architect, interior designer, general contractor or other remodeling or decorating professional, an equal number plan to combine professional work with their own.

• Kitchens and bathrooms remain the most popular remodeling projects among Houzz users - 48 percent plan a bathroom remodel, 45 percent will redo a kitchen in the next two years.
• Midwesterners have the biggest budgets for kitchen and bath remodels, $30,500 and $13,600 respectively. Homeowners in the South are planning to spend only $23,800 and $11,600.
In the next two years, 72 percent of homeowners surveyed plan to decorate or redecorate, 40 percent plan to remodel or construct an addition, while 10 percent are planning to build a custom home.

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