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The Canadian still loves innovation
But average spending declines amid inflation and rising interest rates
The home renovation industry is going through a “recalibration” process, with homeowners spending less money on renovating their homes than they have in recent years, especially when compared to the pandemic.
“While overall spending is down from last year due to inflation and higher interest rates, the majority of homeowners surveyed are still planning to renovate,” says Cher Magen, CEO of HomeStars, an online marketplace that connects homeowners with home service professionals.
On average, Canadian homeowners spent $12,300 on renovations in the past 12 months. 79 per cent of residents had cash available to pay for those homes, with 77 per cent of Ontarians and 85 per cent of Albertans financing their projects from their savings, according to the fifth annual HomeStars Reno report.
Finance. Of the 21 percent of homeowners seeking outside financing for at least part of their project, line of credit was by far the most popular at 58 percent, followed by credit cards at 38 percent. Only four percent considered traditional bank loans.
The report, which is based on a national survey of Canadian homeowners who renovated homes in the past 12 months, also found that only one in three homeowners plan to postpone planned renovations due to rising interest rates.
While nearly three-quarters of respondents plan to do at least one home renovation in the next year, the average budget is expected to drop to $10,264.
Renovating the look and feel of a home and improving its aesthetics and functionality was the most important motivation for renovation at 59 percent, followed by improving the outdoor space for better enjoyment at 32 percent.
Interior painting, installing new appliances, and bathroom renovations topped the list of reno home projects. Outdoors, there has been an upward trend in patios, decks, water features, and pools since 2022.
Modern farm. Modern farmhouses were the No. 1 preferred home style at 23 percent, followed closely by ranch/cottage homes at 22 percent. Contemporary/modern lags by 15 percent. “We thought there would be more variation across the country, but there wasn’t,” Magen says. “The modern farmhouse is a beautiful mix of traditional and modern, which is why it will last a while.”
Fixer uppers, multi-generational life. While 15 percent of homeowners bought or sold a primary property in the past year, only 28 percent purchased a penthouse property, down from 44 percent in 2022.
Meanwhile, 25 per cent of respondents expect to live in a multi-generational household within the next decade, with Ontarians 28 per cent more likely to do so. “This makes sense when you think about the shortage of affordable housing in Toronto,” Magen says.
Sustainability. Seventy-nine percent of respondents believe sustainability is “important” when choosing building materials for renovations, but only 59 percent of those who renovated in the past year used green products. Of these products, energy-efficient appliances were the most popular at 30 percent, followed by low-VOC paint at 22 percent.
Weather-related fixes. One-third of homeowners have completed emergency repairs due to weather-related events. These repairs peaked in Atlantic Canada at 41 per cent, followed by Ontario at 34 per cent, thanks to ice and rainstorms. Magen expects next year’s report to find that western Canada may rank first because this year’s survey was completed in July, before the greatest impact of wildfires in that part of the country.
Smart home technology. Ontarians led the pack in smart home technology, with 72 per cent owning at least one smart home product – a notable increase from the national average of 66 per cent.
Smart thermostats led the charge, with 33 percent of national respondents installing them in their homes, followed by an internet-based home assistant like Alexa or Google Nest at 32 percent, and a video doorbell/security camera at 30 percent.
Weather-related fixes. Fifty-five percent of homeowners are considering making changes in response to an increase in weather-related events. Trimming trees to protect their property is at the top of the list, followed by creating an emergency fund for such events.
“Anecdotally, we’ve heard from a range of homeowners this year that insurance companies are covering fewer and fewer weather-related events, so I urge Canadians to increase their reserve funds for repairs,” Magen says.
More findings from the HomeStars Reno report
● If given the opportunity to move their current home to a dream location, Canadian homeowners will choose the waterfront. Lakeside living ranks first at 30 percent, followed by oceanside living at 23 percent.
● Among national respondents, 16 per cent own an income-producing property, with British Columbia homeowners topping the list as landlords at 21 per cent.
● Only 12 percent of homeowners surveyed say they have been in a dispute or disagreement with a neighbor over a renovation, most often over property lines and the construction of fences and decks.
Visit https://homestars.com/reno-report/ for additional findings on lean homes, smart home features, and how trust impacts staffing providers.