A study done at the end of last year by Marketscreener.com found that 43% of U.S. homeowners renovated their home last year, and an additional 33% plan to renovate this year.  This means roughly two in five Americans are either currently remodeling or planning to do so! The survey showed that for those who have recently renovated, 65% chose to upgrade their current home instead of moving and 71% said they are choosing to remodel rather than buy a new home.  Also, it found Gen Z and Millennials are especially likely to remodel instead of moving and homeowners with children living at home were found to choose renovations to stay in the same school district and community.

I would generally agree with these stats, but oddly enough, I often find that people who renovate often DO sell their home within a year for a variety of reasons: the remodeling with constant workers in and out made them crazy and question themselves why they decided to renovate in the first place; they didn’t like the finished work when really all they did want was to move to a larger or smaller home. Many homeowners said they wanted to stay put and improve their existing homes due to high moving costs, elevated mortgage rates, and limited desirable new inventory. It makes no sense these days when you bought during the COVID years with a 3% mortgage rate to buy now at a 6%+ rate, right? And despite the U.S. about to get a new head of the Federal Reserve (‘The FED’-central banking system) shortly, I don’t see interest rates dropping back to 3% for a long, long time if ever. There’s too much going on with the world economy and inflation to see such low rates again.

Remember those rates during the epidemic were a response by the FED to the economic problems caused by the national/international pandemic. The FED cut rates to almost zero to boost the U.S. economy and boost businesses like mortgage lending, insurance sales, construction and supply chains. Basically, we were in a short recession and the FED’s website has a great explanation as to what was going on back then and the response taken by our government at Federalreserve.gov.

The average renovation/upgrades they found in the survey that people were doing were under $20,000. Want to get a guesstimate of renovations for your home?  There are millions of sites, but I like Homeadvisor.com for reasonable remodeling quotes, like: bathroom ($6,640-$17,624), kitchen ($14,587-$41,540), basement ($12,021-$34,635), new central air unit ($3,912-$8,072), build a small addition ($21,904-$83,368), etc.  I’ve also heard locally to build a separate detached ADU, say in your backyard, can cost $50,000-$400,000 depending on the type that you build. A garage conversion for an ADU can cost $50,000-$150,000 according to Utahhomebuilders.com. Washington County is famous for homes with ADU’s called ‘casitas’ as many seniors desire a separate space for visiting family or caregivers.