| A study commissioned by 2004 National Hardware Show producer Reed Exhibitions finds that a majority of homeowners make improvements to their homes within the first year of purchase. Many consumers also make improvements to their previous homes to prepare them for sale. The Not-for-profit Home Improvement Research Institute (HIRI) did the study. Kitchens, bathrooms and living rooms are the most likely interior spaces to be improved in both newly-built and existing homes. Owners of newly-built homes are also likely to do landscaping projects. The study found that 52 percent of recent home buyers had completed one or more home improvements within the first year of purchase, and half were planning at least one more project within the next year. The most frequently purchased products include paints and sundries, lumber and building materials, and floor coverings. Overall, recent home buyers spent more than $4,900 during the first year. Buyers of older homes spent an average of $3,600, while those who bought new homes spent an average of $7,000. Owners of older homes most frequently cited a desire or need to replace worn-out or old materials, while owners of new construction were most often seeking to beautify the house. Purchases of both types of homes reported that they did improvements to support new features and change the décor. About 40 percent of respondents who sold a home prior to this purchase said that they made improvements to their previous home to get it ready to sell. The most common improvements prior to sale are interior painting, exterior structural improvements, new flooring, interior structural improvements and replacing cabinetry and countertops. The most frequently improved rooms are kitchens, bathrooms, and living rooms. “The vast majority of homeowners said they believed that the money spent on improvements to their previous home was compensated by the increased value,” said Fred Miller, HIRI managing director, noting that homeowners spent an average of $3,000 to improve homes before sale. New Homes vs. Older Homes
Purchasers of existing homes are more likely to paint interior spaces; replace or repair flooring; do electrical wiring; and install new lights and appliances. Owners of new construction are more likely to landscape and build patios or decks. Not surprisingly, owners of existing homes have completed and are planning more improvements than owners of new construction. As noted above, however, owners of new construction spend more on their improvements. “New home buyers were more likely to hire contractors, which at least partially explains the higher average spending, ” Miller said. Miller also noted that purchasers of newly-built homes had a higher average household income than those who purchased older homes, increasing the likelihood that more high-priced products would be purchased. Purchasing Home Improvement Services and Products
Overall, contractors are involved in about one third of projects done to newly-purchased homes and nearly half of the projects completed in previous homes prior to sale. Consistent with other HIRI research, homeowners most frequently used contractors who had done previous work for them, or who were recommended by family and friends. About 10 percent of the projects included installers from home improvement retailers. Regardless of professional involvement, it was the consumers who most often purchased the products. HIRI members The Home Depot and Lowe’s were cited as source for about three-quarters of those purchases. Paying for Home Improvements
Most consumers said they used money from savings to pay for their recent projects. Those who purchased existing homes were more likely to use their savings (77 percent) than purchasers of newly-built homes (69 percent). Less than 10 percent of home-buyers used credit cards to pay for improvements, and two percent said they used money from a loan or excess mortgage money. About the Study
Telephone interviews with 600 recent home buyers were completed between March 15 and March 30, 2004. The sample included 300 respondents who had purchased brand new homes and 300 who purchased older homes. Survey respondents were pre-qualified as being the household members responsible for their home or property improvements, and spent an average of 20 minutes to complete the interview. The margin of error is +/- four percent. About HIRI
HIRI is a 23-year-old trade association that conducts a broad range of research on the home improvement industry. Members pool their resources through annual dues to conduct forecasts of industry size and trends, detailed profiles of consumers, and studies of the practices and needs of remodeling professionals. For the $10,000 annual dues, HIRI members are receiving $504,700 worth of research in 2004. Non-members can purchase research reports after member-exclusivity expires. For more information about HIRI, its research and membership, visit http://www.hiri.org or call 813-627-6750. | 
