Who’s Doing the Most Remodeling?

Spending on remodeling has topped $670 billion as Americans upgrade their homes. See which family configurations and demographics are most likely to tackle big projects.

By Julie A. Palm

Whether we’re talking to retailers, interior designers or home furnishings brands, they’re telling us that in many parts of the country, it’s remodeling that’s driving purchases of home furnishings, as the housing market continues to be strangled by higher mortgage interest rates, consumer fears about the broader economy and low housing inventories. And, on at least on two of those fronts, the news doesn’t seem to be improving.

The U.S. Census Bureau’s May construction report released on June 16 showed housing starts falling to their lowest annualized rate in six years. The decline was particularly striking in multifamily housing starts, which plummeted 41.6% in May, but overall, housing starts fell 15.4% from April.

As The Street notes, “the findings are crucial for millions of Americans who rent or plan to buy in a market already short of an estimated four million homes.”

And, while the Federal Reserve left interest rates unchanged at its meeting last week, of the 18 Fed officials who provided a forecast, nine envision raising rates later this year.

So, unable to move into new homes, many Americans are remodeling — and a recently released report from the National Association of Home Builders provides insights into who is investing money into their homes.

Using Consumer Expenditure Survey data, NAHB estimates homeowners spent about $670 billion on remodeling projects in 2024, with nearly one-quarter of all owner-occupied households making upgrades.

“Residential remodeling is an important and growing sector of the housing market, particularly as elevated mortgage rates and limited housing inventory encourage many homeowners to improve their existing homes rather than move,” the NAHB report says. “Moreover, the aging housing stock and persistent housing inadequacy issue continue to drive growing demands for home improvements.”

More money, more remodeling

It’s not surprising that NAHB found that homeowners with higher annual incomes are spending more on remodeling than their lower-earning counterparts, with about 40% of remodeling expenditures coming from homeowners earning $200,000 or more each year.

“Higher-income households were more likely to remodel and spent substantially more when they did,” according to the report. “Nearly 29% of households with $200,000 or more income had home improvement projects in 2024, compared to only 18% among households earning less than $50,000.”

Higher-income households spent more than three times on remodeling than those with lower incomes, investing nearly $61,000 on average in home projects in 2024.

Married … with Children

Married couples are driving remodeling, both in terms of the number of projects and the amount spent, according to the NAHB. They accounted for 60% of all remodeling projects and spent $458 billion in 2024.

Married couples without children account for 36.6% of total spending on remodeling. But “married couple households with children make up over a third (37.3%) of the total share of remodeling expenditures. Married couples with children ages 6-17 spend the most per remodeling household annually compared to other married couples, averaging $43,330,” the report says. “These households are often in their prime earning years and might improve their homes to meet the needs of their growing families through projects like kitchen and bathroom upgrades, additional bathrooms or finished basements.”

Married couples with kids also spent the most on home additions, averaging $159,187 on those big projects.

Growing families and aging in place

The NAHB notes that spending on remodeling varies widely across age groups — and that those in two cohorts are spending the most on home upgrades — homeowners ages 35-44 (spending an average of $42,400) and those ages 55-64 (spending an average of $40,300).

“The first peak is consistent with family formation, as the median age of first-time home buyers is 38 years old,” the report says. The second peak among older homeowners “may reflect pre-retirement remodeling, including long-term home modernization or aging-in-place preparations,” NAHB says.

Looking at generational demographics, NAHB notes that baby boomers (ages 62 to 80) accounted for about 38% of all spending on remodeling. “This reflects not only the larger size of the baby boomer homeowner household number … but also the greater home equity accumulated by this generation over time, which may increase the financial capacity to do home improvement projects,” the report says.

Gen X households (ages 46 to 61) follow boomers closely in terms of spending on remodeling, perhaps because they are in what is generally peak earning years and have high homeownership rates.

Interestingly, millennials (ages 30 to 45) spent the most on remodeling projects in 2024 at $36,300, followed by Gen X ($33,700). “Millennials also spent relatively more on additions, with average expenditure on additions exceeding $160,000,” NAHB says. “These patterns largely reflect the needs of growing families and/or remote work.”

(Lighting News Now’s Editor-in-Chief Linda Longo recently dived into findings from the Home Improvement Research Institute’s Generational Differences in Home Improvement Activity Report. I recommend checking out her article, too, to fully understand how millennials and other demographic groups are approaching home buying and home improvement.)

While some Americans may by stymied in their efforts to purchase a new home, the NAHB report and anecdotal reports support the idea that they still care deeply about improving their homes, upgrading their living spaces to support their evolving needs and lifestyles.

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