It is no surprise that this past year has brought on many unforeseen circumstances across many industries. City and town offices were ordered to shut down at the beginning of the pandemic causing delays for attorneys who need municipal certificates, mortgage companies were extremely backed up due to the low rates which caused a litany of refinancing applications, and extremely low inventory and high buyer demand flipped the market upside down.
As we begin to see the other side of the pandemic and throughout the past year, the home improvement and renovation industry is seeing an extremely high demand for tools, materials, and home improvement service providers. With everyone home for so long and many people still not traveling, most are now putting their money towards home renovation projects; some because they’re now working from home and spending more time there, and some because buying a new house in this market isn’t an attractive option with so much competition.
The upside to these renovations is that in the future when owners who decided to pause on selling and buying finally give it a go, they will reap benefits and yield a return on investment on their improvements.
Cost of Materials
With so many people looking to renovate their homes, the demand for materials has skyrocketed. According to WCVB, when the pandemic hit it was initially predicted that the home renovation industry would slow down. But with everyone stuck at home beginning in March of last year, just the opposite happened. The need for wood and other materials for home projects significantly increased and with that, came increasingly high prices. The cost for lumber is 3x higher than it was last March.
Other materials that saw a significant cost increase including hardware (screws, bolts, etc.) which increased in price by over 31%, millwork, which includes flooring & molding, increased in price by nearly 8%, and paint and related materials saw a 2% price increase.
With the increased cost of materials, companies and independent contractors are subsequently increasing their prices to supplement for the additional costs. But that doesn’t seem to be stopping clients. Many contractors are still seeing high levels of demand and are completely booked out for the next few months.
Mike McGrory, Vice president Property Acquisitions, Development and Property Management for Lamacchia Realty shared how from his perspective they are seeing similar trends. The turnaround times for materials and fixtures (a bathroom vanity, for example) are much longer – what used to take a week or two now takes 5-6, and prices on these things have doubled because the warehouses have low staffing and therefore can’t produce things fast enough.
Not only are contractors and architects seeing demand for indoor projects, but outdoor projects are also seeing a big increase as well. Swimming pools and hot tubs are a hot commodity this summer and according to the team at Lamacchia Landscape Construction, they are seeing a large increase in requests from clients looking to install patios, firepits, walkways, and even basketball courts to make the most of their yards this summer.
What You Can Do
There are a few things you can do to prepare yourself if you looking to make some renovations to your home:
With increased prices, it can take some additional planning budget-wise to ensure your project stays on track. Whether you’re adding a deck or renovating your bathroom, DIY-ing or working with a contractor, make sure you fully understand the cost of materials, services, and other fixtures. Having your budget ready before you start the process will give you a good idea of what you can afford. And of course, don’t forget your permits!
Have some additional time on your hands and looking to save some money? Think about DIY-ing your project. Once you get the materials you are the master of your domain.
- Painting a room may take a day or two but is a relatively easy and inexpensive process. Choose your color, grab some brushes and go to town!
- Want a change from solid paint? Install your own beadboard, place some peel and stick wallpaper, or install faux brick paneling. These give an out-of-the-box and modern look to your room.
- Spruce up those windows. It’s amazing what some new window treatments can do for a room! Opt for bright curtains or blinds if the room allows – letting more light in overall can give the room a freshened look.
- New lights and ceiling fans can bring new life to your room. By simply switching out these fixtures your room will have an updated feel overall.
Just like with anything we’ve seen over the past year patience is key in this time that we’re in. As the spring progresses and we get into summer, costs will most likely still be high and contractor availability will still be limited. Something to watch is how this will impact the new construction/flipping industry. If the high demand and low supply are here to stay, there will be large effects seen throughout those industries.
By planning ahead and having your budget ready, you will be prepared for any home renovation project that comes along. It is always a smart idea as well to reach out to your Realtor and confirm with them which projects your home would benefit most from so that when the time does come to sell, you’re ready to attract the most buyers!