In the past five years, the country’s homeowner equity has doubled – and this is driving billions of dollars’ worth of home improvement.
But homeowners in which states are benefitting the most?
According to a recent report from the mortgage data firm CoreLogic, five states stand out as the ones that have gained the most equity in the past year. But not all those homeowners are putting their high equity dollars towards luxury home upgrades. Depending on where they are in the country, some are splurging on lifestyle remodels, while others are keeping improvements more practical.
Here’s a look at the top five states for per-homeowner equity gains in the past year – and the top home improvement projects* homeowners in those states are putting that equity towards.
One-Year Increase in Average Homeowner Equity: $21,832
Home price appreciation has been extremely strong in the Centennial state during the past few years, which has helped motivate Colorado homeowners to make the most of the space they have.
One of the top ten projects that Mile High homeowners are taking on are basement remodels — a move that not only helps homeowners to maximize the square footage in the house, but also allows for the option of converting it into a room that can be rented out.
This strategy is being employed more and more by first-time home buyers looking to offset ownership and mortgage costs, as it enables buyers to get into a home they might not be able to afford otherwise.
Another home improvement project that Colorado is seeing more of than any other state is the installation of synthetic grass or landscaping — a project that speaks to an eco-friendly homeowner population, as it reduces water consumption significantly.
One-Year Increase in Average Homeowner Equity: $23,571
Homeownes in the Bay State are using their equity not so much to embellish, but to fortify their homes and add to its comfort.
The projects Massachusettes residents take on at a much greater rate than any other states are all related to staying warm and toasty: Installing oil boilers, radiator systems and heating cables for the roof. Of course, as Winter approaches, these items are getting more attention.
Another home improvement listed in Massachusetts’ top projects was the installation of fire protection systems, one more indicator that homeowners in this state take home safety and preservation seriously.
When it comes to aesthetic improvements – while the East-coasters may not splurge on lavish upgrades popular in other parts of the country, Massachusetts residents are curb-appeal-conscious: They are hiring landscape designers at a greater rate than the rest of the country, and index high in lawn care in general.
Avg. cost to install an oil boiler: $5,251
Avg. cost to install a radiator system: $3,729
Avg. cost to install heating cables: $800
Avg. cost to install fire protection: $761
Avg. cost to hire a landscape designer: $4,496
One-Year Increase in Average Homeowner Equity: $27,124
The third-highest dollar gains in homeowner equity in the past year were in the dry, Beehive State.
According to Zillow, the median home value in Salt Lake City is just above $287,000, and Salt Lake City home values alone have gone up more than 8 percent over the past year.
It’s no surprise that the number one home improvement project that Utah homeowners are taking on is installing a swamp cooler – something that comes in handy the most in dry, desert climates.
One project that Utah homeowners take on at a much grather rate than other states is installing heating cables for a roof, a task used to melt snow and prevent ice buildup on overhangs.
Utah residents also pay plenty of attention to their home’s sophisticated and elegant aesthetic – as projects like installing landscape curbing, and the building a brick or stone wall all landed in the state’s top ten.
One-Year Increase in Average Homeowner Equity: $30,022
California residents are often known for having a deep concern for the environment. Sure enough, this value is reflected in the way the state’s homeowners choose to spend their home equity dollars, as California homeowners are installing electric vehicle charging stations at a much greater rate than the rest of the country.
Californians are also using their equity towards lifestyle upgrades that keep them enjoying the weather in the Sunshine State — like remodeling a swimming pool, putting in a game court or installing a waterfall – all of which landed in California’s list top 15 most popular home improvement projects.
But creating outdoor sanctuaries and going green aren’t the only improvements homeowners in the state are spending thousands on – earthquake protection is the item residents there are doing at a rate that far exceeds those of other states.
Avg. cost to install electric vehicle charging station: $635
Avg. cost to remodel a swimming pool: $8,165
Avg. cost to install a game court: $7,527
Avg. cost to install a waterfall or fountain: $2,572
Avg. cost to earthquake retrofit a home: $4,037
One-Year Increase in Average Homeowner Equity: $40,379
With an average equity gain of $40,329 this past year, Washington homeowners are indulging and investing in remodeling projects that will help them to age-in-place, stay secure and improve their lifestyle.
Included in the state’s top ten list of projects are both installing a radiant heating system, and an elevator or chairlift – remodels that indicate Washington homeowners are looking to make their homes more comfortable as they prepare to stay in them as they grow old.
When it comes to home improvements that add value and enjoyment to everyday life, homeowners in the Evergreen State are installing skylights, building water docks and putting in fireplaces at a greater rate than homeowners in other parts of the country.
Avg. cost to install a radiant floor heating system: $3,729
Avg. cost to install an elevator or chairlift: $4,487
Avg. cost to install a skylight: $1,493
Avg. cost to build a water dock: $6,188
Avg. cost to install a fireplace: $2,037
Brad’s Final Word
The increase in equity is driving billions of dollars in increased home improvement spending – and it will only continue to go up. Why? Two reasons:
First, homeowners are feeling richer and have more access to Home Equity Loans or Lines of Credit. The degree, of course, varies by state, as do the types of improvements homeowners are putting that equity towards.
And next, approximately 750,000 borrowers achieved positive equity over the past 12 months – or rather, fewer homeowners are now in a negative-equity position. That means more homeowners have the means move, or use their equity to improve their current home.
*According to internal HomeAdvisor data
All average project costs listed are attributed to HomeAdvisor’s True Cost Guide.