Demand For Home Improvement Down As Rising Costs Force Homeowners To Rein In Spending
Posted by: electime 7th June 2023
- Only 35 per cent of UK homeowners are definitely improving their homes this year, down from 52 per cent in 2022
- 71 per cent of tradespeople will have work drop out this year because of the rising cost of living
- The increasing cost of materials and rising operational costs have meant 86 per cent of tradespeople need to increase their prices for homeowners this year to stay in business
New research from the find-a-tradesperson platform, Rated People has revealed the construction industry is heading for a ‘home improvement squeeze’ in 2023 as tradespeople continue to battle with rising costs and homeowner demand is down.
Following the ‘home improvement boom’ where record numbers of homeowners improved their homes over the past few years – just 35 per cent of homeowners are now definitely planning home improvements this year, which is a sizeable drop from 52 per cent in 2022.
The findings come from this year’s edition of the Rated People Home Improvement Trends Report which analysed 1.1 million home improvement jobs posted through the Rated People platform by UK homeowners to uncover the impact of the cost-of-living crisis on tradespeople and homeowners.
Homeowner Budgets Are Being Squeezed
The price of materials and operational costs have increased substantially over the past two years, and the vast majority of tradespeople have needed to pass these costs on to homeowners to stay in business.
In 2022, 94 per cent of UK tradespeople experienced rising costs, and this year, 92 per cent of tradespeople say their costs are increasing further.
This has made home improvements less affordable for homeowners who are already struggling with the wider pressures of the cost-of-living crisis. This year alone, 86 per cent of tradespeople are reported to be raising their prices for homeowners, and on average tradespeople are increasing their prices by 17 per cent.
As a result, almost three in four (71 per cent) tradespeople expect to have work drop out this year and 77 per cent think homeowner demand will reduce.
Gardeners and landscape gardeners are the trade that’s preparing for the biggest reduction in demand, with a full 100 per cent saying they expect to have work drop out. Nine in 10 (88 per cent) bathroom fitters expect they’ll have less work this year and 78 per cent of handypeople think their pipeline will shrink.
Top 12 trades that expect to have work drop out in 2023 because of rising prices ( per cent)
- Gardeners/ landscape gardeners 100
- Bathroom fitters 88
- Handypeople 78
- Builders 77
- Gas/ heating engineers 77
- Carpenters/ joiners 75
- Tilers 75
- Plasterers/ renderers 71
- Painters and decorators 69
- Electricians 62
- Roofers 57
- Plumbers 54
The Rising Cost Of Materials
By analysing Government price indices for building materials and compounds over the past two years, Rated People has revealed that of the top materials that saw the biggest price rises last year, the price of steel and concrete saw the biggest rise.
The price of concrete reinforcing steel bars was 44 per cent higher on average in 2022 when compared to 2021. Fabricated structural steel saw a 34 per cent average increase and the cost of pre-cast concrete products was 26 per cent higher in 2022 than the year before.
Top 10 construction materials that saw the biggest average year-on-year price rises ( per cent)
- Concrete reinforcing steel bars 44
- Fabricated structural steel bars 34
- Pre-cast concrete products 26
- Insulating materials (thermal or acoustic) 24
- Gravel, sand, clays and kaolin 23
- Blocks, bricks, tiles and flagstones 23
- Plastic doors and windows 22
- Bituminous mixtures from natural/ artificial stone 20
- Builders woodwork 19
- Metal screws 18
How Tradespeople Are Attracting More Business In 2023
Around one in three (29 per cent) tradespeople are investing in marketing and advertising this year to pull in more business from the work that’s available. They’re also looking to expand their businesses to offer more services, improve their website/ social channels, potentially reduce prices where they can and expand into different locations.
Top 10 ways tradespeople are attracting more business in 2023 (per cent)
- Investing in marketing and advertising 29
- Expanding to offer more services 25
- Improve website/ social channels 25
- Consider reducing prices to pull in more work 24
- Expanding into different locations 24
- Investing in tools/ vehicles 16
- Form partnerships to facilitate more jobs 14
- Increase wages to fill jobs 13
- Hire more workers 10
- Hire support for admin/ business operations 8
Adrienne Minster, CEO of Rated People, said: “The big home improvement boom of past years was incredible for tradespeople. But now, with fewer homeowners able to have work done, 2023 is set to be a more challenging landscape for them to navigate.
We’re committed to helping skilled tradespeople across the UK to weather the storm and find the work that’s available in their areas – as well as future-proof their businesses – as homeowners rein in spending.”
To read more about how the cost-of-living crisis is affecting tradespeople and to see the full Home Improvement Trends Report 2023 visit: https://www.ratedpeople.com/blog/home-improvement-trends-report-2023-home-improvement-squeeze
