2. Looking back a year
According to the 2016 Houzz State of the Industry Report, the general contractors (GC)/remodelers/builders category experienced a 12% increase in 2015 revenues while the specialty – building & renovation category achieved a 14% increase.
Of the GCs/remodelers/builders surveyed for the report, 20% said their 2015 revenues increased 25% or more. In the specialty category, 21% said revenues increased 10–14%; 18%, 15–24%; and 14%, 25% or more.
Because of the typical seasonal effect, the 3 components of the Houzz Renovation Barometer had the lowest scores during Q4 2015, but for the year the number of inquiries, number of new projects/orders and their size scored in the 70s for remodelers.

3. Looking forward a year
According to the new John Burns Real Estate Consulting report, residential repair and remodel spending will total $300.5 billion during 2016, a 7.8% increase from 2015.
Big-project spending (more than $5,000) would increase 7.2%; owner-big-spending, 10%; and renter-big-spending, 3.8%. For small projects, overall spending would increase 8.6%; owner-small-spending, +9.4%; and rent-small-spending, +2.8%.
According to the Houzz Q Renovation Barometer, the Q score for GCs/remodelers was 77, rebounding from 65 for Q The specialty category’s Q score was also 77, compared to 66 for Q

4. Helped by Healthy Existing-Home Sales
Although owners of new single-family homes and condominiums may have projects for remodelers, it’s the purchasers and owners of existing homes that drive remodeling.
During 2015, existing-homes sales increased 6.5% to 5.26 million units, the most since , but approximately 25% less than the million units sold during 2005.
Existing-home sales started very well this year, with a seasonally adjusted annual rate (SAAR) of 5.47 million units for January, but then decreased 7.1% during February to a SAAR of 5.08 million. Nonetheless, sales increased 2.2%, compared to last year.

5. Market Makers & Movers
According to the March 2016 Bankrate Money Pulse survey, adults, 18–29, are the largest age group most likely to improve their homes during the next 12 months, at 37%; followed by adults, 50–64, 30%; adults, 30–49, 28%; and adults, 65+, 21%.
Despite the 65% of homeowners 49 and younger planning to improve their homes during the next 12 months, the 50+ age group may be the best target for remodelers, as 42% of the heads of households in the US are adults, 55+.
Another reason for remodelers to focus on the older Generation Xers and Baby Boomers is that the luxury remodeling market, or those households with the highest incomes, is spending at a much higher rate than middle and lower income homeowners.

6. Costs, Labor and Leads
According to the 2016 Houzz State of the Industry report, GCs/remodelers/builders’ top challenges will be the increased cost of doing business, 37%; shortage of subcontractors, 35%; and consumers overly concerned about project costs, 34%.
It was similar in the specialty – building & renovation category: increased cost of doing business, 37%; difficulty hiring/being understaffed, 34%; and consumers overly concerned about project costs, 31%.
Among the top 200 home improvement pros in Qualified Remodeler’s 2015 HIP 200, 23% said their top opportunity for 2016 was an overall higher volume of leads for new business. Adding a new or expanded service area was second at 14%.

7. Advertising Strategies
With referrals the most effective marketing tactic for remodelers, they should promote a “Neighbor Project” program. For each paying- customer referral a current customer provides, he or she and the referral receive a discount or substantial home gift.
Since outdoor living projects – decks, patios or landscape – are the top choice among homeowners, remodelers can generate new project leads with the incentive of a new grill, smoker, lighting package or special discount from a local furniture store in a co-promotion.
Remodelers can effectively and successfully target Baby Boomer homeowners – and especially the luxury renovation market – with a combination of television and newspapers or television and direct mail.

8. New Media Strategies
Remodelers should make a major commitment to hiring a professional photographer and/or videographer to populate their Websites with the high quality photos and videos that homeowners say are important Website elements.
May is National Remodeling Month, which provides remodelers with many topics for social media and/or blogs: emphasizing the value of an exterior home inspection, the importance of roof repair/replacement as it protects the entire home and aging-in-place ideas.
To attract young homeowners, start a “See It Now” mobile promotion with live video from a project site, using Periscope. Invite viewers to visit to talk with the remodeler and see the build quality. Incentivize with an appropriate coupon (Starbucks, Panera Bread, etc.)