Houzz Study Reveals a Moderate Outlook for Home Renovation Professionals in 2023
Posted by: electime 30th March 2023
2023 Houzz UK State of the Industry reports slowed revenue growth, despite rising costs
Houzz Inc., the leading platform for home renovation and design, including the all-in-one software solution for industry professionals, today released the 2023 Houzz UK State of the Industry.* The report provides an outlook on 2023 and a review of 2022 performance for residential renovation and design businesses, based on data reported by industry professionals in the Houzz community.
Companies across the industry have a tempered perspective, with 40 per cent anticipating a good or very good year and 42 per cent expressing a neutral outlook for 2023. While the sentiment is less widespread than last year, more businesses expect increases in revenues and profits for 2023 than those expecting decreases (50 per cent and 44 per cent, respectively, versus 21 per cent and 30 per cent, respectively).
“Professionals in the home renovation and design industry have a moderate outlook about business activity in 2023, despite concerns around current economic conditions. Though less prevalent than last year, more businesses anticipate revenue growth,” says Marine Sargsyan, Houzz staff economist. “The 2023 Houzz State of the Industry reveals that professionals are willing to implement a diverse combination of marketing, financial and customer-centric strategies to achieve their business targets amidst high overhead and materials costs.”
2023 UK State of the Industry: Major Findings
- A forecast for 2023: Two in five residential companies expect this will be a good or very good year (40 per cent), and 42 per cent express a neutral outlook. Design and build firms are the most optimistic, with 62 per cent anticipating a good or very good year, followed by interior designers (48 per cent).
- Expectations for revenue: More businesses among the industry groups surveyed expect increases in revenue in 2023 (50 per cent) than those expecting decreases (21 per cent), albeit the sentiment is less widespread than last year.
- Increased demand anticipated: In 2023, a larger share of businesses believe that demand for their services will improve (52 per cent), rather than decrease (31 per cent). Design and build firms, in line with their overall outlook for business in 2023, feel confident about demand this year, with almost three-quarters anticipating an increase (73 per cent).
- Costs of doing business rise: More firms across all of the industry groups cited an increase in the cost of doing business (82 per cent) versus those citing a decrease (4 per cent), with the share of businesses reporting an increase rising by five percentage points this year (82 per cent compared with 77 per cent in 2021).
- Hiring slows: Many residential renovation and design companies continued to hire employees in 2022 (22 per cent), although at a slower rate than in 2021 (29 per cent). Design and build firms continue to lead the industry in hiring at 46 per cent, followed at a distance by interior designers and architects (20 per cent, each).
- Product availability improves: The availability of products and materials was less of a concern in 2022, compared with 2021. The proportion of firms citing it as one of their top three business challenges fell eight percent (12 per cent compared with 20 per cent in 2021).
- Pros implement diverse business strategies: More than two-thirds of businesses target larger budget projects (67 per cent) and more than half increased marketing and sales efforts (55 per cent) to achieve expected growth in 2023. Businesses also plan to improve customer experience and employee productivity (45 per cent and 33 per cent, respectively).
The complete 2023 Houzz UK State of the Industry report can be found here.
There are more than 3 million home renovation and design professionals on Houzz in over 60 categories, including architects, interior designers, home builders and design and build firms.
*The Houzz UK State of the Industry was conducted among home renovation firms in the Houzz UK community that offer services related primarily to residential renovation and/or design. The study was fielded from December 2022 to January 2023.
