Study

A New Report Shows That Interior Designers Have an Optimistic Outlook on Renovation Work

Houzz's Q3 report is out with some mixed, but generally very positive, results—thanks in part to 695 interior designers surveyed
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This week, Houzz released its Q3 2019 Renovation Barometer—a good indication of the current and future state of the sector. Overall, the results were optimistic and, specifically, the most optimistic among participating architects and interior designers when compared to results over the past two years.

The findings come from a quarterly online survey sent out to U.S. businesses with a Houzz profile, conducted from June 27 through July 10 of this year. The total number of respondents clocked in at 2,622, with 695 interior designers and 349 architects responding. Questions included in the survey focused on the increases and decreases of actual work since the last quarter, and what respondents anticipated in terms of the future number of project inquiries and new projects. The Backlog Indicator, which calculated wait times across the nine regions, also asked survey recipients about how long it took to begin work on new midsize projects once a commission was received.

In some areas, the findings were a bit varied, showing consistency if not growth. Recent record rainfall, as well as labor shortages and tariff challenges, could conceivably be behind these more stagnant figures. (As Nino Sitchinava, Houzz's principal economist, noted, Q2 of 2019 was the wettest in U.S. history since 1957, and a third of those surveyed pointed to the current issues surrounding tariffs as a concern.) Comments shared by Sitchinava in a release also indicated that individuals may be less likely to undertake construction projects as the year goes on. Additionally, a 100-point scale helped break down sentiments. Recent business activity, studied in the Recent Business Activity Indicator, came in at 63 points, a figure considered steady in comparison with that of Q1 of 2019. Elsewhere, expected business activity registered at 71 points, one point up from Q2's results.

Interior designers may tend to view their future work situations as a half-full glass, unlike some of their cross-industry colleagues. Houzz's study was broken up into sections focusing on construction, architecture, and interior design as three separate categories. Of the architects surveyed, expectations of receiving future renovation-related work, as part of Expected Business Indicator, increased to 68 points when compared to data collected in this year's past quarter. The results that came from interior designers were even more striking: Rising three points in total, expectations of future renovation work increased to 77 points.

The national average project backlog was also studied. It came in at an average of 4.7 weeks—a figure considered to be somewhat steady in comparison with that of Q2. However, exact averages tended to fluctuate by specific area. (These regions were demarcated to align with the nine areas that make up the U.S. Census Bureau Divisions.) The Mid-Atlantic and Western Mountain areas both came in at an average of 5.3 weeks—the highest figure out of the lot. While the Pacific region experienced an average of 4.8 weeks of backlog, in the South Atlantic, the figure came in at 4.7 weeks. The Central Southwest, which includes Texas, registered at 4.4 weeks, while the Central Northeast, the Central Southeast, and New England all tied at 4.2 weeks. The low figure of the grouping was four weeks flat—the average seen in the Central Northwest. While the results may seem similar overall, it's interesting to hypothesize how local climates and economies might have impacted the results. And for an architect or interior designer juggling Mid-Atlantic and New England commissions at once, it might be worth keeping in mind that things could unfold faster up north.

While the outlook is undoubtably optimistic among interior designers, the construction side of the business is facing continued concerns over recent weather, labor availability, and tariffs. "[C]onstruction sector sentiments are some of the lowest we’ve seen since 2015, although still high in absolute terms,” Sitchinava said in a statement. “While labor shortages are top of mind for construction and architecture businesses alike, a third of businesses report . . . rising material costs eroding margins on existing contracts and causing unease among prospective customers.” And yet, despite all this, it's, generally speaking, clear skies ahead.