Download the Full ReportPositive Outlook for 2023: More than half of residential construction and design companies (50% to 56%) surveyed by Houzz predict that 2023 will be a good or very good year. Interior designers are the most optimistic (with 56%anticipating a good or very good year), followed by design-build firms and general contractors (54% each).
Increased Demand Is Anticipated: More businesses in 6 of the 7 industry groups believe that
demand for their services will increase (21% to 32%) rather than decrease (12% to 24%). Specialty decorators are the most confident that demand for their services will improve (32%), followed by interior designers and landscaping and outdoor professionals (24% each).
Lower Revenue Growth Is Predicted: Businesses across all industry sectors anticipate much slower revenue growth than they experienced last year (0.3% to 6.1%). Decorating specialists are most bullish, expecting revenue growth to average 6.1% this year. Construction businesses (general contractors, design-build companies and building and renovation specialists) anticipate growth of less than 3% for 2023 (2.9%, 2.3% and 1.3%, respectively). Architects, who are typically the most conservative in average expected growth estimates, have the lowest anticipated rate (0.3%). On average, actual revenue growth in 2022 did not meet expectations for businesses across all sectors, following the unusually high performance the year prior. Cost of Doing Business Continues to Rise: More firms in all of the industry groups cited an increase in the cost of doing business than cited a decrease. For 2022, 70% to 92% of firms reported an increase, compared with 64% to 93% in 2021. While product and material costs continue to be the No. 1 cost driver, the share of businesses reporting this as the most significant driver fell by 15 to 29 percentage points.
Less Concern Over Product Availability: The availability of products and materials was less of a concern in 2022 compared with 2021, with only three groups citing it as a top business challenge. Price volatility continues to pose a challenge; however, the sentiment was less widespread than in 2021 (down by 20, 9, 13 and 9 percentage points among general contractors, design-build firms, building and renovation specialists, and landscaping and outdoor professionals, respectively).Download the Full Report
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Positive Outlook for 2023: More than half of residential construction and design companies (50% to 56%) surveyed by Houzz predict that 2023 will be a good or very good year. Interior designers are the most optimistic (with 56%anticipating a good or very good year), followed by design-build firms and general contractors (54% each).
Increased Demand Is Anticipated: More businesses in 6 of the 7 industry groups believe that demand for their services will increase (21% to 32%) rather than decrease (12% to 24%). Specialty decorators are the most confident that demand for their services will improve (32%), followed by interior designers and landscaping and outdoor professionals (24% each).
Lower Revenue Growth Is Predicted: Businesses across all industry sectors anticipate much slower revenue growth than they experienced last year (0.3% to 6.1%). Decorating specialists are most bullish, expecting revenue growth to average 6.1% this year. Construction businesses (general contractors, design-build companies and building and renovation specialists) anticipate growth of less than 3% for 2023 (2.9%, 2.3% and 1.3%, respectively). Architects, who are typically the most conservative in average expected growth estimates, have the lowest anticipated rate (0.3%). On average, actual revenue growth in 2022 did not meet expectations for businesses across all sectors, following the unusually high performance the year prior.
Cost of Doing Business Continues to Rise: More firms in all of the industry groups cited an increase in the cost of doing business than cited a decrease. For 2022, 70% to 92% of firms reported an increase, compared with 64% to 93% in 2021. While product and material costs continue to be the No. 1 cost driver, the share of businesses reporting this as the most significant driver fell by 15 to 29 percentage points.
Less Concern Over Product Availability: The availability of products and materials was less of a concern in 2022 compared with 2021, with only three groups citing it as a top business challenge. Price volatility continues to pose a challenge; however, the sentiment was less widespread than in 2021 (down by 20, 9, 13 and 9 percentage points among general contractors, design-build firms, building and renovation specialists, and landscaping and outdoor professionals, respectively).
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