Last year, homeowners in Greater Boston sunk $6 billion into home improvement and remodeling projects. It was an impressive amount of spending, one of the largest of any metropolitan area nationally. But it was only a 1 percent increase over 2019. No doubt, the pandemic helped dampen spending.
Does that mean pent-up demand for home improvements will fuel a banner year in 2021? As remodeling projects begin to proliferate with the advent of warmer weather, here are some considerations ― including big price increases ― for any homeowners who may want to redo a bathroom or kitchen, or add space to their homes.
Q. How hard will it be to find a contractor?
A. Difficult (as always), but not impossible, according to one leading study. Total spending on home and yard improvements is actually expected to decline by 1 percent this year in Greater Boston, according to Harvard’s Joint Center for Housing Studies, which has compiled data on remodeling expenditures for more than 25 years. That suggests the demand for contractors won’t be super crazy, or at least no worse than in recent years.
Q. Why is spending expected to decline this year in Greater Boston?
A. One major reason is the very tight and expensive housing market. Sellers of homes tend to spruce up their properties before putting them on the market, while buyers often make improvements immediately after moving in. But inventory of houses for sale remains at rock-bottom levels: the Greater Boston Association of Realtors recently listed fewer than 900 homes for sale in the 64 cities and towns it tracks, a drop of more than 50 percent compared with the previous year.
Q. What about costs of remodeling?
A. Expect sticker shock. The big culprit is lumber. In the last 12 months, the cost of lumber and plywood has increased a whopping 56 percent, while plastic construction material, insulation material, and Gypsum (for drywall) have all increased between 5 percent and 8 percent, according to the consulting company Cumming.
Angi, the digital marketplace for homeowners and service providers, says the biggest increase in costs are for cabinets, now 55 percent more expensive, and for home additions, 30 percent higher.
Angi lists double-digit increases for landscaping (17 percent); new siding (16 percent); bathroom remodeling (13 percent); and home office (10 percent). Smaller increases are expected for new heating/air conditioning (9 percent); kitchen remodeling (8 percent); exterior painting (7 percent); new roofing (7 percent); new windows (7 percent); new deck or porch (6 percent); and new flooring (3 percent).
The skyrocketing costs are mostly because of the pandemic, which has caused some factories and mills to close or slow down and has disrupted supply chains. The international supply chain was further disrupted last month when a huge container ship ran aground in the Suez Canal, blocking shipping traffic through that crucial artery for almost a week before being freed on March 29.
It could take weeks, possibly months, for backlogs in global shipping to be cleared, experts say.
Q. What about kitchen and laundry appliances?
A. Expect double-digit increases in cost, according to Gap Intelligence, which tracks prices for appliances nationally. Since the pandemic began a year ago, prices have gone up: for ranges (14 percent); refrigerators (13 percent); dishwashers (11 percent); and laundry appliances (10 percent).
Gap Intelligence also tracks appliance availability. Here there is a rapidly improving trend: Before the pandemic, stores had 90 percent of their appliances in stock; in November, that measure had plunged to 52 percent; as of last week, availability had rebounded to 82 percent.
Q. How do I find a contractor?
A. You can go online to use Angi, Houzz or other digital marketplaces. Those sites ask a series of questions to “match” you with contractors. The big home improvement stores, such as Home Depot and Lowe’s, offer installation of bathrooms, kitchens, and other projects.
Ask for references from friends, relatives, and coworkers. And you can drive around the neighborhood looking for the names of contractors displayed on signs in front of houses where remodeling is ongoing.
Q. How do I check out a prospective contractor?
A. Anyone who performs residential contracting work must register with the state as a home improvement contractor. You can check whether a contractor is registered here. That website also lists complaints against contractors. (If you want to file a complaint against a contractor, go here.)
Check the Better Business Bureau, Yelp, Google, and other websites for reviews. You can also look online for legal actions brought against a contractor.
Q. What are the basics in choosing a contractor?
A. It’s best to get at least three written, detailed bids. If the dollar amounts on all three are close, it’s probably the going price. If there are wide disparities, make sure there are no differences in the type of materials to be used and that the work to be done is the same. The lowest bid isn’t always the one to choose. When I put an addition on my house 10 years ago, I picked the second lowest bid because I got a better vibe from that contractor. ”I’ll treat your home like it was my own,” he said. (And he did).
Q. What about the terms of the contract?
A. Contractors cannot require an upfront deposit that exceeds one-third of the total contract price, according to state regulations. And final payment cannot be demanded until the contract is completed to the owner’s satisfaction. A common practice is to pay a small deposit, then one-third when work begins, one-third halfway to completion, and one-third at completion.
Q. What if something goes wrong?
A. Your options include mediation, arbitration, and legal action.
Mediation must be agreed upon by both parties. Check with local consumer programs affiliated with the attorney general’s office.
By law, registered contractors must agree to arbitrate. During arbitration, a neutral third party decides whether to order the contractor to provide a refund for poor or unfinished work.
For claims under $7,000, small claims court may work. If you have a larger claim, you may want to consult a lawyer.
If you win your case in arbitration or in court and the contractor fails to pay, you can apply to a state-managed fund for up to $10,000.