Indicating a positive outlook on the renovation industry, the Q3 2023 Houzz Renovation Barometer found more industry professionals in the construction and design sectors are anticipating business growth in the third quarter of 2023. The optimism comes after a decline in homeowners utilizing professional construction and design services in the first half of the year.
“Pent-up demand and macroeconomic conditions, such as aging housing stock and high mortgage rates, which continue to drive home improvement activity, are instilling a sense of optimism among builders, remodelers, architects and interior designers as they look ahead to the second half of the year,” says Marine Sargsyan, Houzz staff economist. “We continue to monitor the industry to identify whether improvements to inflation and other economic indicators create more stable pricing for businesses and an environment in which homeowners proceed with their full project scope. That said, ongoing labor shortages and product and material delays will continue.”
The report, which tracks residential renovation market expectations, project backlogs and recent activity among businesses in the U.S. construction sector and the architectural and design services sector, revealed that backlogs have reached a record high of 13 weeks. That number is 2.5 weeks longer than last year during the same time period.
Build-only remodelers anticipate an increase in business activity in Q3, while expectations among design-build firms remain the same for Q3. More firms in the architectural and design services sector reported increases in their business expectations for Q3 than reported decreases, although both subsectors reflect a decline in business performance expectations compared to the previous quarter.
To read the full report, click here and to learn more about the state of the construction and design industries, click here.