Nearly 80% of homeowners aren’t creating a budget for home improvement projects, meaning contractors that educate them can improve the odds of securing the job.
The findings stem from Modernize’s homeowner sentiment survey, an ongoing, long-term study of how homeowners research and evaluate home improvement projects like window replacement, roofing, solar power, and heating and air conditioning. The study covers how homeowners budget for their improvement projects, how they find and select their preferred contractor, and how they plan to pay for their projects.
“The information, insight and guidance that an experienced contractor can offer a homeowner, in an unbiased and helpful manner, can make all the difference in securing a major improvement project,” said Gregg Hicks, Modernize vice president.
The information comes from surveying more than 12,300 homeowners, and reflects data from more than 3,000 consumer and trade surveys completed from November 2019 to April 2020. The survey did factor in the impact of COVID-19 as well. According to the results, 59% of homeowners still plan to begin their project within the next two to four weeks, regardless of the pandemic.
Among the most significant findings is that 79% of homeowners do not create a budget for their project, an increase from 75% in 2019. A total of 88% of homeowners looking for a solar power project report having no up-front budget.
Of those who did create a budget, 32% said friends and family were the most helpful source, down from 41% in 2019. About a third of respondents say they use online tools and calculators. Even then, of homeowners who created a budget, 58% felt “somewhat confident” about their budget, and only 23% felt very confident.
“Our research shows that homeowners are at a deficit when they’re considering a home upgrade,” said Hicks. “They want a trusted partner, which is exactly what professional contractors can and should be.”
Three-fourths of homeowners plan on financing at least part of their project, while 30% say they intend to borrow the project's entire cost. This is an increase from 23% in 2019.
Naturally, stress is a major factor these days, and it does play a role in home improvement projects. When asked how they were feeling about their projects, 27% of homeowners say they feel stressed. Specifically, the results show 38% of homeowners are stressed out over their roofing project.
With more than a third of homeowners stressed over roofing projects, it means contractors who can be a source of assurance and clearly-presented knowledge are going to stand out from the rest.
Having a clear bid is critical during the sales process, as homeowners say a confusing or unclear bid is the top reason they won't hire a contractor. This is closely followed by lack of communication and lack of expertise. Additionally, 67% of roofing homeowners said they plan to compare three or more quotes, up from 63% in 2019, and that 30% said pricing is “very important,” followed by 53% who say it’s “somewhat important.”
How does a contractor stand out? According to the survey, homeowners are equally impressed by a contractor’s expertise and their online ratings and reviews. However, expertise is quickly becoming a major factor, as 26% reported it being critical in 2020 when compared to 19% in 2019.
Having that great reputation is important, as a majority (53%) of homeowners say they plan on conducting one to five hours of research before submitting a lead. This research is mostly conducted using Google, followed by home improvement sites like Modernize. Only 12% said social media is helpful in their research.
Click here to download Modernize's full eBook containing the survey results.