- High prices and mortgage rates are leading homeowners to renovate what they have instead of buying new.
- A new Redfin study shows 43% of Americans renovated their homes last year, while another 33% plan to renovate soon.
- Popular upgrades include paint, bathrooms kitchens; most of those who renovated their homes spent under $20,000.
SALT LAKE CITY — In a market with high prices and high mortgage rates, some homeowners are looking to renovate what they have rather than buy something new.
According to a new study from real estate company Redfin, 43% of Americans renovated their home in the last year, with another 33% saying they plan to do that sometime in the next year. Most of those surveyed said they decided to renovate rather than buy something new.
The most popular improvements, according to the study, are fresh paint, bathrooms, and kitchens. The study noted that most renovators spent less than $20,000 on their upgrades.
Dejan Eskic, who studies the housing market at the Kem C. Gardner Policy Institute at the University of Utah, isn't surprised by the study's findings.
"A lot of people are locked into a lower mortgage rate, and a lot of people have vested equity," Eskic told KSL. "They've been in their house for a while, so they're able to tap into that appreciation and do some (remodeling) and stay put rather than have their housing costs go up again to move."
Esre and Caitlin Vinu, who own Lehi-based Universe Construction, said they meet many homeowners who want to improve what they have.
"What we're seeing is that a lot of people are adding on to their homes. They're doing home additions. They're doing (accessory dwelling units). They're finishing the basement. They're renovating the kitchen, the bathroom, basement," said Esre Vinu. "Anything to kind of just stay put, just with interest rates being as high as they are."
"They just want to improve where they live," added Caitlin Vinu. "They want to stay in their neighborhoods. A lot of them have a lot of solid bonds in their neighborhood, so they just are looking to improve."
Currently, mortgage rates sit at 6.33%, according to Mortgage News Daily. In Utah, the statewide median sales price for a home in March was $515,000, which is higher than it was a year ago.
"Housing is unaffordable and it makes sense to kind of add on to your house. Personally, I did that last year because we outgrew it real quick," said Eskic. "You have no choice but to go one way or the other."
Eskic characterized the current housing market as "neutral" and favoring "those who can afford" it. But one thing, he said, is certain — people are staying in their homes much longer than they used to.
"The tenure is a lot longer now. It's doubled over the past couple of decades," he said. "Just because it's so unaffordable and difficult to move up."
