For home service contractors, understanding key home service industry statistics guides your advertising and marketing strategy. Specifically, there’s significant room for growth. For current business owners and those considering starting, data informs smarter decisions.
Home Service Market Growth
The home service market is large and growing year-over-year. In the United States, the home service market is estimated at $506 billion. The market is expected to grow at a compound annual growth rate (CAGR) of 35.81% from 2019 to 2026. Several factors drive this growth, and a key advantage is that services must be delivered at the home. For local contractors, finding your niche creates real market share.
Reasons for home services market growth include:
Aging Population
The US home services market is highly valued by aging Americans. An aging population increases demand for home services like home health care and home repairs. Many homeowners hire professionals instead of handling daily maintenance and upkeep themselves. This helps older Americans live independently well into retirement.
Traditional home services like plumbing, HVAC, electricians, lawn care, and housekeeping have grown significantly. Emerging models serve older Americans too. Services like in-home healthcare, meal prep, grocery delivery, personal shopping, and fitness training are experiencing rapid growth. The home services market adapts to meet population demands.
Dual-Income Households
The home services industry is booming because working Americans lack time for house maintenance. Dual-income households have less time for repairs and upkeep, so they hire professionals more often. These households typically have more disposable income than single-income homes. Marketing targets this growing segment specifically.
Online Marketplaces
Significant market segmentation exists within home services, with wide-ranging offerings. Many home services are still driven by small to medium-size businesses. Traditionally, geography limited competition and market size. Online platforms like Angie’s List, Amazon Home Services, and HomeAdvisor connect homeowners with providers easily. They function like e-commerce, matching homeowners with available services.
This growing internet reach is a major trend. On-demand services through websites and apps help local contractors reach new customers. Some platforms echo old yellow page ads and direct mail campaigns. Partnering with on-demand platforms can help nascent businesses grow, but customer loyalty may go to the platform instead of your business. If the market fully shifts to online marketplaces, personal homeowner-contractor relationships risk disappearing.
For this reason, home services owners should follow verified research and use multiple strategic marketing tools. Growth can include online platforms and strong digital campaigns built solely for your benefit.
Home Improvement Shows And Social Media Influencers
The home services market benefits from home improvement show popularity. Across television, YouTube home service channels, social media influencers, and streaming services, homeowners get inspired to improve their homes. This rising demand often starts as DIY interest but requires professional home service contractors.
Which Home Services Market is Growing Quickly?
The home service market is diverse with many service types. The fastest-growing businesses serve essential home needs and save households time. A few include:
- Cleaning and maid services
- Plumbing
- Electrical work
- HVAC
- Painting
- Carpentry
- Roofing
- Landscaping
- Home health care
- Pet care
The home service market is competitive, yet there are abundant opportunities for businesses providing high-quality services and finding unique niches.
How to Start a Home Services Business
When planning to start or acquire a home service business, follow these steps. While diverse businesses fill the home services market, these apply to every business serving homeowners directly.
- Choose a home service niche: You’ll enter the market where you’re most experienced. Because competition is fierce, consider a specific niche. Within landscaping, you can distinguish yourself by offering hardscape work beyond lawn mowing. Within HVAC, adding indoor air quality services and plumbing attracts recurring customers.
- Do your research: Once you’ve chosen your niche, research local demand. Marketing for home services starts by developing an ideal buyer persona. Knowing what you do and who needs your services shapes effective business planning and marketing campaigns.
- Get necessary permits, licenses, and partners: Depending on your service type, you may need permits and licenses. You’ll also need to find business partners including suppliers and vendors.
- Create a business plan: A business plan is your roadmap. Include your goals, strategies, and how you’ll achieve them. Many resources help, but seek local guidance.
- Get funding: Some businesses start with minimal costs. If you’re doing part-time work, you already have tools and equipment. Most need financing for tools, vehicles, personnel, and operating space. Funding sources include loans, grants, and investors.
- Market your business: Many first-time owners skip this. Marketing is misunderstood by most. In home services, strong marketing generates new customers. A strong digital campaign helps your business stand out across search engines, social media, and home services websites. Word-of-mouth and traditional ads alone reduce growth and margins.
- Provide excellent customer service: In home services, you must drive to serve homeowners. Skill and knowledge matter, yet homeowners hire and rehire people they like. Success demands great customer service with every homeowner you serve.
- Stay up-to-date on trends: The home services industry constantly evolves, so stay current on latest trends. You’ll serve customers better and stay ahead of competitors and emerging tech. For example, electricians who saw EV charging demand rising began offering installations. Early adopters now outpace competitors responding to market demand. Ride the wave up and your business becomes a leader.
- Be patient: Building a business takes time and patience. Working with a professional marketing agency helps you plan, strategize, and budget for growth. Don’t expect overnight riches or quit when your business plateaus. Focus on excellent customer service and gradual growth.
How many home services businesses are there?
The number of home services businesses in the United States is estimated around 2.5 million. This number isn’t exact because small home service businesses often go unreported. Part-time and seasonal services like pet walking, house sitting, home cleaning, and snow removal are small sectors. Yet many part-time businesses become full careers.
Among the estimated 2.5 million businesses, over 6 million people work in home services. The industry generates over $500 billion annually. Home services are expected to continue growing. The market is projected to grow at a CAGR of 35.81% from 2019 to 2026.
Key Trends for the Future of Home Services Market
Clearly there’s room for growth and lots of businesses competing. While established businesses claim market share, nimble, forward-thinking owners can disrupt the industry. Here are key trends shaping home services in the coming years:
New Generation Mobile Booking Smart Homes The Green Home
A New Generation Of Homeowners
Millennial homeownership is rising. Millennials are now the largest US generation and increasingly buying homes. Unlike prior generations, these homeowners are internet-savvy. Nearly all buying decisions for Millennials start with internet searches. Several factors affect outdated home service providers. Millennials prefer online marketplaces to find and hire local contractors and favor sustainable, eco-friendly services.
Mobile Booking Services
On-demand home services don’t require third-party vendors. While tech giants push local businesses to pay for platform access, a well-designed website saves you thousands and captures valuable customer data. Young homeowners are comfortable with websites and apps. Mobile booking services give you access to them on your terms.
Smart Homes
Remodeling, rewiring, installing, and prepping smart homes represent major growth. Nearly every appliance today considers the internet of things. Millennials expect their homes to integrate with their phones. This includes controlling lighting, thermostats, televisions, speakers, and security systems. Home service contractors can install and maintain these devices.
The Green Home
Millennials and next-generation homeowners focus on reducing carbon footprint. While many Americans still dream of homeownership, green services are highly valued. Homeowners increasingly seek green home services designed to be more environmentally friendly than traditional options.
Home service contractors embracing these ideas and homeowner desires are positioned for strong growth.
One example is landscapers using gasless technology. Electric trucks, commercial mowers, chainsaws, hedge trimmers, string trimmers, and other equipment are becoming standard. Young homeowners willingly pay more to go green.
Solar HVAC is another emerging model. These systems account for 30-50% of home energy use. Innovative HVAC contractors offer solar installation, moving appliances off-grid into fully renewable energy. Heat pumps have quickly emerged as traditional HVAC alternatives.
New home service jobs didn’t exist years ago, including energy auditors. Energy auditors help homeowners cut carbon footprint by improving system efficiency and reducing energy use. This ranges from simple smart thermostat and insulation installation to complex living roof projects.
The home services industry is dynamic and growing. Abundant opportunities exist for businesses providing high-quality services at competitive prices.
Summary
Amazing opportunities await entrepreneurs in the home services market. Here are 5 key statistics from this article:
- The home services industry is large and growing. In the United States, it’s estimated at $500 billion. The market is expected to grow at a CAGR of 35.81% from 2019 to 2026.
- The aging population drives home services growth. Older Americans increase demand for home health care and services they can no longer perform.
- Dual-income households also drive growth. These households have less time for repairs and maintenance, so they hire professionals more often.
- Online marketplaces make finding and hiring contractors easier. Platforms like Angie’s List and HomeAdvisor let homeowners compare prices and reviews easily.
- Next-generation homeowners have emerged. Millennials have unique homeownership visions. Many are inspired by home improvement. Most want to reduce energy use and carbon emissions. Nearly all focus on smart home technology.
In summary, the home services industry is dynamic and growing. Key trends will shape the industry in the coming years. The most successful new home service business owners use data to plan and market their services.