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{{propApi.successMessage}} {{region}} Change locationShrinkflation hits kitchens and bathrooms renovation market
Shrinkflation hits kitchens and bathrooms renovation market
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Speaking at the launch of the HIA Kitchen and Bathroom Report, Mr Reardon said: “Shrinkflation is evident across the economy as households bear the cost of higher mortgage repayments, and home renovations are no exception.
The HIA Kitchens and Bathroom Report provides comprehensive forecasts and unique insights into this important sector of Australia’s residential construction industry and wider economy.
“Affordability and value have become stronger considerations for households looking to renovate or build a new kitchen or bathroom,” added Mr Reardon.
“This adjustment in consumer behaviour is evident in bathrooms more than kitchens. Each new home built in 2023 has on average two bathrooms, down from 2.6 per home in the previous year.
“The building and renovation boom in recent years saw kitchens increase in size, with more appliances and premium fittings. As homeowners spent more time at home, they also spent more money on their home renovation.
“Overall, the renovations market is cooling from the record peak of recent years but remains strong due to the low level of unemployment, house price growth and limited quality housing stock available to purchase.
“During the pandemic, the cost of a new kitchen or bathroom rose as households sought larger living and work from home spaces. The cost of a new kitchen and bathroom is continuing to rise, but this time it is due to higher construction costs.
“Renovation jobs have also been constrained, with a large majority of bathroom jobs involving the same or even smaller footprint. More than half of these jobs last year involved expanding bathroom spaces.
“In contrast, the majority of kitchen renovations in 2023 resulted in an increase in the footprint of the kitchen.
“The cost of construction will stabilise this year as global supply chains are restored, and labour shortages ease.
“There is strong pent-up demand for housing amid record high population growth and a strong renovations segment. This bodes well for a solid volume of home renovations activity in the years ahead, albeit, below the level observed in recent years,” concluded Mr Reardon.
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