Home improvement is a common project undertaken by homeowners to improve their property. These improvements can range from installing new appliances to building a deck or fence. Many home improvement projects provide a good return on investment, especially when done for resale purposes. However, it is important to keep in mind that your own comfort and enjoyment of your home should be the primary motivation for any improvements you make.
During the housing crisis, fewer Americans were buying homes and instead chose to stay put and repair, renovate, or upgrade their current properties. According to Houzz, a home renovation platform, new and existing homeowners spent an average of $19,000 on home improvement projects during the first half of 2023. Spending varied by homeowner’s ownership status, with short-term homeowners spending almost double the national median.
The categories of home improvement that are surging the most this year include work on a house’s exterior. Specifically, hiring landscapers, constructing decks, and building fences are all up significantly compared to last year. According to Anderson, this is likely due to rock-bottom interest rates and a desire for more space for outdoor living.
While most home improvement projects are completed using cash from savings, more expensive projects are paid for with sources like cash-out refinancing, equity loans, contractor arranged financing, and credit cards. However, debt isn’t always a good option; paying for home improvements with credit often results in years of high monthly payments and can be difficult to manage when it comes time to sell your property.