Where Homeowners Are Spending In 2025 — And What It Means For Contractors
Last Updated on June 11, 2025 by Dan Stenabaugh
Despite economic pressures, rising mortgage rates, and inflation, American homeowners in 2025 aren’t hitting the brakes—they’re just getting smarter about where and how they spend. For contractors, remodelers, and trades professionals, this means big opportunities…if you’re paying attention.
Here’s a breakdown of where the money is going—and how you can adjust your messaging to win more work.
1. Hidden Costs: Maintenance Spending Tops $21,000 Per Year
Homeownership now comes with steep ongoing costs. A June 2025 report from Business Insider revealed that the average U.S. homeowner spends $21,232 annually on hidden homeownership expenses like insurance, taxes, utilities, and routine maintenance (Business Insider, 2025).
Homeowners in high-cost states like Hawaii, New Jersey, and Massachusetts are hit even harder.
Marketing tip: Show how your services reduce long-term expenses. Preventative maintenance packages or seasonal inspections are a natural fit for today’s homeowner priorities.
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2. Preventative Upkeep Is Replacing Emergency Fixes
In its 2025 State of Home Spending report, Angi found that 71% of homeowners now prioritize preventative maintenance—a big shift from the reactive repairs we saw during the pandemic housing boom (Angi, 2025).
Interestingly, spending on emergency repairs dropped from $1,667 to $978, indicating that more homeowners are fixing things before they break.
Use this angle in your messaging: “Fix it now, save more later.” Bundled service plans or recurring maintenance subscriptions make this value tangible.
3. Remodel, Don’t Relocate: A Shift in Homeowner Mindset
With 30-year mortgage rates still around 7%, most homeowners are choosing to stay put—and invest in upgrades instead. A full 67% of homeowners say they prefer renovating to buying a new home, and many plan to stay in their current house longer than originally planned (AP News, 2025).
Home improvement spending is still strong: the Joint Center for Housing Studies at Harvard forecasts that home remodeling will reach $526 billion by Q1 2026 (JCHS, 2025).
Position your service like this: “Fall back in love with your home.” A strong emotional angle that makes upgrades feel like a lifestyle improvement—not a luxury.
4. Kitchens, Bathrooms, and Outdoor Projects Still Lead
According to Angi’s 2025 homeowner survey:
- 31% plan kitchen remodels
- 22% are targeting bathrooms
- 13% are investing in outdoor improvements
Meanwhile, Houzz data shows median kitchen remodel spend for small spaces is $35,000, and $17,000 for small primary bathrooms (Houzz, 2025).
What this means: Contractors offering high-ROI, mid-range updates will thrive. Highlight cost-effective improvements, smart materials, and energy-efficient designs.
5. DIY Is Up—But Skilled Labor Is Still in Demand
About 55% of homeowners say they’ll DIY more projects this year, but 54% also report struggling to find qualified contractors (Angi, 2025).
Pro tip: Don’t fear the DIY trend—work with it. Offer consultations, partial installs, or pro inspections for DIYers. Position yourself as the expert they can turn to when it gets complicated.
6. Energy Efficiency & Sustainability Are Hot Topics
Homeowners are increasingly prioritizing energy-efficient upgrades—especially when tax incentives and rebates are available.
59% of homeowners say sustainability is a top priority, with solar panels, insulation upgrades, heat pumps, and smart thermostats leading the way (Houzz, 2025).
Use this language in your sales copy: “Cut energy bills and boost comfort.” If your services qualify for rebates or federal incentives, make that a prominent part of your proposal.
7. How Homeowners Are Funding Projects
- 84% are using savings
- 29% are using credit cards
- 12% are tapping home equity (via HELOC or cash-out refi)
(Source: Houzz U.S. Home Renovation Trends Study, 2025)
With record home equity built up during the past few years, many homeowners are choosing to leverage that value to upgrade their homes rather than sell.
Make this easier: Offer financing guidance or partner with lenders. Even just mentioning flexible payment options can increase your close rate.
Final Take: The Contractors Who Win in 2025 Will Do This One Thing…
They’ll speak to the priorities of today’s homeowner.
- They’ll sell prevention, not just repairs.
- They’ll emphasize value, not just features.
- They’ll show why now, not someday.
If you want help turning these trends into powerful marketing that gets calls, clicks, and contracts—I’m here to help.
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