Why more Australians are choosing to stay and improve

Faced with higher interest rates and a tightening housing market, many Australians are opting to reinvest in their homes instead of relocating. The ‘Reno Nation’ trend isn’t simply a by-product of market conditions – it reflects a broader shift in how housing is viewed, not just as a place to live, but as a long-term investment worth protecting.

Homeowners are approaching renovation with purpose, balancing lifestyle needs, design aspirations, and long-term return on investment. It’s a trend playing out across suburban fringes and regional communities alike, where staying put is becoming the smarter and more strategic choice.

“Property is a long-term asset class,” says Jodie Cramer, CEO of Andersens, leading Australian floor covering provider. “You can’t talk strategy in this market without thinking in decades. And while cycles shift, the fundamentals don’t change. People still need somewhere to live. Population growth continues to outpace housing supply. That creates certainty and investors respond to certainty.”

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Housing as an asset class

Despite ongoing economic uncertainty, renovation activity remains strong. According to CoreLogic, renovation-related lending has remained more resilient than lending for property purchases, and the ABS reports a continued flow of spending on alterations and additions – even in a high-rate environment.

This, Cramer argues, is no coincidence. “If you view property through the lens of long-term value, renovating starts to look like a rational strategy,” she says. “In many cases, it’s not just more cost-effective than moving, it’s a better return on capital. We’re seeing homeowners upgrade with confidence, especially those who’ve built up equity and want to premiumise their space.”

Cramer adds that the predictability of the Reserve Bank’s monetary policy has helped investors remain confident, even with rising rates: “We’re not heading back to the Wild West of 20% interest rates as we saw in the 80s. We’re operating within a predictable policy band. And when any asset class gains that kind of certainty, it becomes a magnet for investment.”

Cost pressures and consumer confidence

Of course, renovation isn’t without its challenges. Labour shortages, compliance costs, and inflationary pressures have all pushed up the cost of delivering home improvement projects.

“The cost of specialist labour has outpaced product inflation in our sector,” Cramer explains. “Even cosmetic projects like painting or soft furnishings are affected if trades are in short supply. In flooring and window furnishings, which we deliver end-to-end, we’ve seen this clearly. The work still gets done, but the timelines and budgets are under pressure.”

Yet despite these pressures, Andersens franchisees continue to see strong demand across the country. And that, says Cramer, comes down to one thing: trust.

“We don’t participate in recessions,” she says, referencing a guiding principle passed down from the company’s founder, Jack Andersen. “What that means is, regardless of what’s happening in the broader economy, we focus on what we can control – serving the customer well. Our franchisees meet people where they are. Sometimes that means helping them stretch their budget. Other times, it’s about guiding them through a higher-end design journey. Either way, it’s about long-term relationships, not transactions.”

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Building for now and later

One of the reasons the “improve, don’t move” trend is gaining ground is that housing preferences themselves are changing. Australians are staying in their homes longer, adapting spaces to suit intergenerational living, hybrid work, or aging in place.

Cramer points out that even the idea of what a home “should” be is shifting: “The Australian housing landscape is no longer easy to generalise. Whether it’s a federation home in Gosford or a cyclone-rated build in Cairns, today’s homeowner is thinking about design, comfort, energy efficiency, and value. And they’re not always looking to move up the ladder; they want to make where they are, feel more like home.”

Many businesses with local footprints are well-positioned to observe how renovation trends are playing out on the ground. Franchise models in particular, led by owner-operators embedded in their communities offer a real-time window into consumer sentiment and shifting priorities.

“In regional areas especially, we’re seeing demand driven not by indulgence, but by smart investment thinking,” says Cramer. “People are weighing up the cost of selling, the risk of rising rents, and the comfort of staying in a home they already love. The maths often points to renovation.”

As Australia continues to be faced with housing affordability and persistent undersupply of properties, the improve-don’t-move trend shows no sign of slowing. For those in the home improvement sector, the implication is clear: homeowners are willing to invest but they expect guidance, transparency, and solutions tailored to their circumstances.

“If you build your business around what customers actually need now and, in the future, you don’t have to chase the cycle,” Cramer adds. “You become part of the foundation they’re building on.”

Architecture & Design Team

Andersens

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