LAS VEGAS -- Recent research from the Home Improvement Research Institute (HIRI) shows that buyers of new and existing homes have a large impact on the home improvement market. The research, announced at the 2006 National Hardware Show, examined the behavior of approximately 600 recent purchasers of new homes and 600 purchasers of existing homes in terms of what home improvement projects they are undertaking, what motivates these activities, where they buy the products needed to complete these projects and where they go to get information on these projects.
"The first step in capturing a significant portion of this lucrative market segment is to fully understand the customer," says Fred Miller, managing director of HIRI. "With the data from this study, retailers, manufacturers and service providers will have much better insight on how to effectively market to these very important homeowners. Clearly, those that do the best job of serving this market will be very successful. The results we presented are very current and highly relevant to your everyday consumer."
Key findings include:
The Recent Homebuyer
Recent homebuyers are an important segment of the home improvement market
The motivation to move concentrates on:
- Wanting to own a home of their own (renters)
- Relocation due to a new job
- Upgrade to a larger home
- Growing segment - downsizing
Recent Movers Account for Higher Average Spending Levels -- Homeowners that have lived in their home for 0-2 years spend an average of $2,300 yearly on their home, 3-5 years spend an average of $2000 annually, more than ten years spend $1700 annually
Main reasons for moving include to own and live in own house (22 percent 2006, 27 percent 2004), current home too small (16 percent, 19 percent 2004) and new job in different location (18 percent 2004, 2006)
Home Projects
On Average, Cost For Home Projects = $2,576
"House Appeal" is the leading motivator for doing home projects
66 percent of new homeowners do at least one project to their new home
57 percent of respondents plan to do at least one project in the next year or two
- Landscaping is top with buyers of new homes followed by deck/patio
- Kitchen, bath & landscaping are key areas for improvement by buyers of existing homes
Almost half of those who sell their old home do projects to ready it for sale
- 61 percent done prior to listing with another 24 percent after listing but pre offer
- 12 percent after an offer is made (up significantly from 2004)
- Kitchens, Baths & Bedrooms are most popular
- Painting and Flooring are the major activities
- Primary goal is to increase the sales appeal of the house
DIY is the most common way projects are done but with some key differences
- A directional shift to contractors for work on the previous home
- Buyers of new homes are more likely to use a pro for work on their current home
- Growth overall in use of pros on their current home
- The motivation to hire a pro focuses on the size of the job, and making sure the project comes out right
New Versus Existing Homes
People Who Buy New Homes:
- Want everything new
- Perceived better value
- Ability to customize to their desires