The Growing Share of Home Improvement Market and Increasing Importance of Renovation in Europe
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Share of home improvement market increases
The share of the R&M market has steadily increased over the past 15 years. In 2008, 48% of EU production volume consisted of R&M works. This has gradually increased to more than 54% in 2022. When we compare the different subsectors, renovation is the largest in the residential sector. We expect that the renovation share will increase further as the need for energy efficiency measures increases due to high energy prices and sustainability legislation, such as the Energy Performance of Buildings Directive (EPBD IV: see below) which aims to ensure a higher sustainability rate.
Share of renovation increases slowly in the building sector
Renovation share of total building production
Share of R&M differs
The share of the R&M market varies among countries. Typically, countries with a higher GDP per capita have a relatively larger R&M market. There are several reasons for this:
- Less developed countries are often catching up and therefore they are investing heavily in new buildings and infrastructure. That results in a relatively lower share of R&M.
- Well-developed countries often have a larger stock of older buildings and infrastructure that requires regular maintenance and renovation. As structures age, they need repairs, upgrades and modernisation to ensure safety, functionality and efficiency.
- Developed countries typically have stricter building codes, safety regulations and environmental standards. Compliance with these regulations often requires periodic upgrades and renovations.
This narrative holds true for Europe, resulting in relatively higher renovation shares in Western European countries. There, the renovation market is approximately 55% of the total building volume. In Eastern Europe, where there is still a lot of catching up (new building) being done, the renovation sector has a smaller share of the total construction output (approximately 33%).
Share of renovation market is higher in Western Europe
Renovation share of total building production, 2022
Renovation costs on the rise
In recent years, the cost of house improvements has increased, surpassing the inflation rate in the European Union. In addition, energy prices have seen an even greater increase, making energy efficiency measures still more financially beneficial than they were in the past.
