An increased interest in home improvements fueled by remote work has Americans spending more time at home, as new research from Today's Homeowner finds many homeowners are spending more of their income [1] on on home improvements.
Data from Harvard University shows that from Q4 of 2020 to Q4 of 2021, the average amount of money spent on home improvements across 48 of the largest metro areas grew by 5.5%. Census Bureau data shows that over a similar period, the median U.S. household income increased by 7.3%. That means that though home improvement spending is rising, homeowners are spending a smaller portion of their pay on renovations.
Key Findings
- Metro areas show stark differences. In Oklahoma City, home improvement spending rose more than seven percentage points more than income between 2020 and 2021, while in Seattle, income rose more than nine percentage points more than home improvement spending.
- Two Oklahoma cities (Tulsa and Oklahoma City) rank as the top two places where home improvement spending is increasing the most relative to income.
- Homeowners in Southern states are spending more on home improvements relative to their incomes. Meanwhile, those in large, coastal cities are spending less.
- Eight of the top 10 places where home improvement spending is rising faster than incomes are in the South.
- Homeowners in Seattle, New York, and Philadelphia are dedicating less of their pay to home improvements.
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Where Home Improvement Spending is Rising Faster Than Incomes
1. Tulsa, OK
Homeowners in Tulsa spent significantly more on home improvements than they used to. Between 2020 and 2021, home improvement spending rose more than seven percentage points more than income.
- One-year change in home improvement spending: 11.2%
- One-year change in income: 4.1%
2. Oklahoma City, OK
Incomes in Oklahoma City rose by only 2.2% between 2020 and 2021 – the smallest increase across the 48 metro areas in our study. However, homeowners still put more money into home improvements. From 2020 to 2021, home improvement spending rose nearly six percentage points more than income.
- One-year change in home improvement spending: 7.8%
- One-year change in income: 2.2%
3. Richmond, VA
Virginia's capital ranks third in areas where home improvement spending is rising the fastest relative to income. There is a 4.6 percentage point difference between how quickly home improvement spending rose and how incomes changed between 2020 and 2021.
- One-year change in home improvement spending: 8.7%
- One-year change in income: 4.1%
4. Las Vegas-Henderson-Paradise, NV
From 2020 to 2021, the average amount of money homeowners in Las Vegas spent on home improvements increased by nearly 9%, while income lagged. The median household income in 2021 was roughly $63,400 – only about 4% higher than in 2020.
- One-year change in home improvement spending: 8.7%
- One-year change in income: 4.3%
5. Salt Lake City, UT
From 2020 to 2021, home improvement spending in Salt Lake City grew by 9.2%. With median household incomes increasing by 5.5% over the same time, the rise in home improvement spending is up nearly four percentage points relative to local pay.
- One-year change in home improvement spending: 9.2%
- One-year change in income: 5.5%
Where People Are Spending Less On Home Improvements
The places where people are spending less on home improvements are in expensive cities that had an exodus of residents in recent years. Housing is more expensive in these metro areas, and people are more likely to rent than own, decreasing the need to take on home projects.
Seattle ranks as the No. 1 metro area where homeowners are spending less on home improvements relative to income. Census Bureau data shows that from 2020 to 2021, the median household income in Seattle grew 12.0%. Home improvement spending rose only 2.7% over the same time.
In two other large cities, New York and Philadelphia, the average amount spent on home improvements dropped 4.8% and -0.4%, respectively. With incomes rising slightly, New York and Philadelphia rank as No. 3 and No. 4 in home improvement spending declined relative to incomes. The table below shows the 13 U.S. areas where the difference is greater than 5%.
To read the full report, including more data, charts and methodology, click here [1].