Home Renovation Professionals Mildly Optimistic in Q2 Business
Palo Alto, April 11, 2024-More professionals anticipate business growth than declines in Q2 2024, with the Expected Business Activity Indicator reaching 58 points for both sectors, according to the Q2 2024 Houzz U.S. Renovation Barometer. This mild optimism follows reduced quarterly activity reported across sectors with design-build firms impacted most significantly. The quarterly Barometer provides timely insights into the residential renovation industry, including expectations, project backlogs and recent activity among businesses in the U.S. construction and architectural and design services sectors.
“While promising economic conditions and improved product availability bolstered optimism among residential construction and design professionals at the start of the year, the anticipated uptick in activity did not fully materialize,” said Marine Sargsyan, Houzz staff economist. “Pros across sectors maintain a hopeful outlook for increased business activity in the coming months. This is reflective of resilient local economies and aligns with positive consumer sentiment nationally.”
Backlogs for new, mid-sized projects have normalized following record highs during the pandemic. In the construction sector, backlogs are currently at 6.5 weeks, which is 5.4 weeks shorter than the same period last year (11.9 weeks in Q2 2023), matching levels from five years ago (6.5 weeks in Q2 2019). In a similar trend, the architectural and design services sector saw a marginal reduction in wait times to 5.6 weeks, slightly less than this time last year (6.1 weeks), and 0.9 weeks longer than 4.7 weeks in Q2 2019.
The overall outlook in the construction sector is favorable with more firms expecting business activity to improve than to slow down. Build-only firms are slightly more optimistic than last quarter with an expected business indicator of 58 points in Q2 (compared with 56 in Q1). In contrast, design-build remodelers anticipate slightly lower activity than the previous quarter (58 in Q2 versus 59 in Q1). Overall, both business groups expect Q2 business activity to be better than Q1.