If you’re into home-remodeling business (or planning to have one), then consider this a fair warning: the market might not be as impressive as the previous years. But if you play your cards right—that is, choose the right services to offer—you can make 2019 and the following years winnable ones for you.

The Lowdown for 2020

Americans go big when it comes to remodeling. Over the last five years since 2013, the home renovations industry already grew by as much as 30%. Home maintained grew the fastest. The volume went up by 5.23% while spending increased by over 8% annually.

Even then, however, the experts already saw a decline in volume and expenditures. And in 2020, it will dip further. The Joint Center for Housing Studies reported that spending will drop below the historic average of 5% about a year from now. By then, the projected earnings will be $347 billion, which will represent only 2.6% growth.

Two factors will lead to a decrease: slow price appreciation and home sales. In his analysis at Forbes, John Wake cited how home prices increased over the last December by 4.7%, which was above the inflation rate.

But this figure was lower than that in spring. The yearly appreciation of residential properties also significantly fell between April and December from 6.5%. If the trend for appreciation is shrinking, then the rate may fall below that of inflation in 2019.

Why does this figure matter? Some Americans do remodeling not only to beautify their homes but to increase their resale value in the market. Low appreciation can mean less motivation to spend money on changes or even maintenance.

Getting Smart

In every challenge, though, is an opportunity—if you get smart with it. Here are a few ideas you can try:

1. Offer Affordable but Necessary Services

When you’re thinking of your business, focus on those that your customers cannot do without because they are not only affordable; they also increase the property’s resale value significantly. A good example is a house-painting franchise.

In a study by Zillow on the impact of paint on home sales, they found out that certain colors can give fantastic returns. Front doors in charcoal gray or black can command a price $6,000 more. Living rooms in light taupe can increase the property’s value by almost $3,000. Meanwhile, repainting a door can be worth $100 to $300 per unit only.

2. Target the Baby Boomers and Millennials

a designer discussing floor plan with his clients

Since home remodeling volumes may slow down in the coming years, you want to be strategic with your marketing. With that, you can target two generations: millennials and baby boomers.

Between the two, the millennials (or the Y generation) provide a higher volume. Pacific Union reported in 2018 that this group had the most number of home improvements over the last 12 months.

Baby boomers, though, are the ones who will spend more for two reasons. One, compared to the millennials, they have better financial leverage.

By now, they have enough equity on their home, have greater access to affordable loans, and their own savings and investment accounts to fund such projects. Many baby boomers are also aging in place, so the changes in the home should reflect their present needs.

Like any other industry, home remodeling will have its ups and downs. What’s essential is you can ride every ebb and flow of the tide.