Home services encompass a wide range of services that cater to the various needs of homeowners and renters. Nearly any service and appliance used within the home falls within the home service market. Some popular businesses include plumbing, HVAC, and electrical services. Maintenance, repair, and replacement of these systems is in constant demand. Other services, including cleaning, pest control, home health care, and other businesses, are experiencing rising demand.
Overall, the home services industry has witnessed significant growth in recent years, with consumers increasingly relying on professionals to handle various tasks related to their homes. Many factors are driving this growth rate and new opportunities on the horizon, likely leading to ongoing and even rapid growth.
The increasing adoption of home services marketing helps businesses build upon their solid customer base and find the best strategies for meeting the increasing demand and changing needs of both older homeowners and the next generation of customers. In this article, we’ll explore the growth rate of home services and the factors driving it, as well as delve into the industry’s key segments and future trends.
What is the Growth Rate of Home Services?
The home services market in the United States is expected to grow at a compound annual growth rate (CAGR) of 5.2% from 2022 to 2028. This home services market growth can largely be attributed to core businesses. However, the market size is more than $500 billion and employs more than 6 million people. This data indicates there are many opportunities for business owners to grow their own business and increase market share within their niche—broad size of the home services industry.
There are crucial factors that help this market gain traction. Marketing campaigns gain customers attention and increase market share. But the market itself is growing due to a number of major trends.
Home Services Industry Market Growth Overview
The home services industry is a diverse and growing sector that caters to the varied needs of homeowners and renters. It includes a wide range of services that help maintain, improve, and manage residential properties.
As people become busier and seek greater convenience in their lives, the demand for professional home services has increased significantly. This has led to the rapid expansion of the industry, with the most in demand home services such as home maintenance and repair, cleaning, pest control, home health care, and other specialized services experiencing steady growth.
At the core of the home services industry is the focus on customer satisfaction and the delivery of high-quality, reliable services. Service providers in this industry often rely on skilled professionals, advanced technologies, and innovative business models to meet the evolving needs of their clientele.
The advent of mobile apps and online platforms has also played a crucial role in the industry’s growth, as they allow consumers to easily find, book, and manage home services from the comfort of their homes. This has led to increased competition among service providers, who are constantly striving to differentiate themselves and offer unique value propositions to attract and retain customers.
The home services industry is also influenced by broader social, economic, and technological trends. For instance, the shift towards environmental sustainability has led to a growing demand for eco-friendly home services, such as green cleaning solutions and energy-efficient home upgrades. The aging population in many countries has also contributed to the growth of home health care services, as more people seek in-home care and assistance for themselves or their loved ones.
Key Factors in Home Services Market Growth
Multiple strategic marketing tools have helped compile this list of why the market size is increasing. These are just a few of the specific reasons the home services market is rising across the nation. Understanding these elements can help home service providers choose effective advertising and marketing campaigns. For many existing businesses within the home service market, adjusting business models to stay ahead of the trends provides an opportunity for growth.
Dual Income Families
More households and families include dual earners. In 2020, 61% of married-couple families had both spouses working, up from 40% in 1960. This is a major boon for the homes service market. Dual income households are also more likely to have children. Working homeowners and busy families are increasing demand for home services because they do not have the time to repair and maintain their own property.
The most in demand home services market for dual income families includes plumbing, HVAC, landscaping, cleaning services, childcare, pet care, and home renovations. Other businesses in the home service market are experiencing profound market growth to ease time constraints of busy professional families.
The Aging Population
The US population is aging, and this is leading to an increase in the demand for home services. As people age, they are more likely to need help with home repairs and maintenance. The percentage of the population aged 65 and over is projected to increase from 16% in 2020 to 25% in 2060. This rising number coincides with older Americans wishing to remain living independently longer.
The most in demand home services market for aging Americans are house cleaning, property management, appliances maintenance and repair, and home health assistance. This accounts for emerging offerings from tech giants like Amazon home services and primary care service. Many older Americans are savvy enough with technology to use on demand home services. However, local businesses with exceptional customer service are often preferred to the online on demand home service provides.
The Rise of the Digital Economy
Digital technologies including the on demand home services market are transforming how consumers find and hire providers. The digital economy is the part of the economy that is based on digital technologies. Websites, apps, and other technology are being created to serve homeowners, renters, and landlords. From babysitting to pet care, cleaning services to healthcare, apps enable people seeking services with providers. Finding and booking appointments online has never been easier or more in demand.
The Increasing Complexity of Homes
Home designs and the systems within them are becoming more complex. Smart appliances, connected smart homes, and modern materials are difficult for many homeowners to maintain and repair themselves. Home services market growth is a direct result of the technology entering homes. The home services market must train and outfit personnel with the right tools to care for these systems.
The most in demand home services market within this trend includes electricians specializing in smart technology installation, maintenance, and repair. There is a growing demand for EV charging in homes and the internet of things can create unique problems for homeowners. Online on demand home services are often less personal and can cause frustration for homeowners. Local technology experts are entering the home services market and will likely become an essential provider just like plumbers, HVAC, and electricians have been for decades.
Changing Consumer Preferences
The growing preference for outsourcing household tasks to save time and effort is another factor driving the growth of the home services industry. Consumers today are increasingly seeking convenience, quality, and reliability in the services they use. Dual income families and the aging population play a role within this trend but increasingly Millennials who are entering the home service market. They are more willing to pay for professional home services that meet these criteria.
Some of the online on demand home services market growth lies within this trend. There are emerging businesses for niche needs including food delivery, fitness and yoga training, mental health support, and even personal errands that homeowners prefer to outsource. Apps and local home service providers offer services like furniture assembly, pet walking, and other daily tasks that prior generations of homeowners performed themselves. As such, home service businesses are positioned to provide exceptional value to these new consumers.
Home service markets in urban and suburban areas are growing. People are living in more dense areas to access better jobs, schools, and culture. Depending on the regional outlook, in the near future, the hectic lifestyles of people living in cities will continue to increase demand for home services. With limited time and resources to manage their homes, urban dwellers are increasingly relying on professional service providers to take care of their home-related needs.
This creates a customer base for the local home services market and on demand home services in and around cities. This rising demand is creating both new opportunities and new challenges for the home services market.
The Most in Demand Home Services
Key segments in the home service industry remain unchallenged. Essential services like water, heating, cooling and electrician will also be prioritized by homeowners and renters. As the factors above demonstrate though, trends will demand home services market growth. Business emerges wherever there is demand and revenue opportunity.
The essential services include plumbing, HVAC, and electrical. The home service market is expanding the definition of essential.While certainly not a comprehensive list of home services, the following segments are important to monitor.
Home Maintenance And Repair
This segment includes services beyond plumbing, electrical work, HVAC maintenance. Modern smart appliances and technology require repair and maintenance. The demand for these services is driven both by the need and the lack of knowledge. The internet of things in one part of this rise in demand. There are also conventional services that homeowners either cannot or do not want to perform including property management like lawn mowing, gardening, tree care, gutter cleaning, leaf removal.
The aging homes throughout the nation also need more complex maintenance including roofing, exterior repairs, basement waterproofing, concrete repairs and foundation services. The home services market will continue to grow for repair as the average age of US homes is rising.
Home Cleaning And Pest Control
Home cleaning services include deep cleaning, regular cleaning, and specialized services such as carpet and upholstery cleaning. Junk removal, pest control services, even interior decorating and furniture moving are all in demand home services.
Home Health Care
While not always considered a part of the home services market, the home health care segment accounts for both local and on demand home services trends. Services as simple as meal prep, prescription delivery, companionship, and transportation are growing the home services market. More complex services such as in-home nursing, physiotherapy, and elderly care are also offered frequently in the home. With an aging population and a growing awareness of the benefits of receiving care at home, the demand for home health care services is on the rise.
Other Home Services
Other services in the industry include providing customized services like home security solutions and environmentally focused home solutions. These services cater to the diverse needs of homeowners and renters, further contributing to the growth of the home services industry. In fact, there are new businesses entering the home services market everyday. Jobs that simply did not exist just a few years ago are in high demand.
The Impact of COVID-19 on the Home Services Industry
The COVID-19 pandemic has had a significant impact on the home services industry. During the initial stages of the pandemic, many home service providers experienced a decline in demand due to lockdowns and social distancing measures.
As people spent more time at home, the demand for certain services, such as home maintenance, repair, and cleaning, began to rise. Home health care services also experienced a surge in demand, as more people preferred receiving care at home to minimize exposure to the virus.
Market Forecast and Future Trends
Most home services industry statistics indicate that the industry is expected to continue growing at a steady pace in the coming years. Technological advancements will play a crucial role in driving this growth, as more service providers adopt digital solutions to improve their offerings and streamline operations.
Additionally, the increased focus on environmental sustainability will create new opportunities for eco-friendly home services. As urban populations continue to grow and consumer preferences evolve, the demand for professional home services is anticipated to increase further. This will almost certainly result in an increase in the home services market size.
Challenges and Opportunities
Despite the growth in the home services industry, service providers face several challenges, such as maintaining service quality, managing operational costs, and staying competitive in a crowded market.
However, these challenges also present opportunities for innovative companies to differentiate themselves by offering unique services, leveraging technology to enhance the customer experience, and focusing on building long-term relationships with their clients.
The growth rate of the home services industry is primarily driven by technological advancements, changing consumer preferences, and urbanization. With a positive market forecast and a multitude of opportunities for innovation, the home services industry is poised for continued growth in the years to come. As the industry evolves, service providers will need to adapt and innovate to meet the changing needs of their clients and capitalize on emerging trends.
Frequently Asked Questions
The growth of the home services industry is driven by technological advancements, changing consumer preferences, and urbanization.
The COVID-19 pandemic initially led to a decline in demand for home services due to lockdowns and social distancing measures. However, as people spent more time at home, the demand for certain services, such as home maintenance, repair, cleaning, and home health care, began to rise.
The key segments in the home services industry include home maintenance and repair, home cleaning and pest control, home health care, and other home services such as landscaping, interior design, and home security solutions.
Service providers in the home services industry face challenges such as maintaining service quality, managing operational costs, and staying competitive in a crowded market.
The home services industry is expected to continue growing steadily, driven by technological advancements, evolving consumer preferences, and urbanization. Innovative companies that adapt to changing market conditions and leverage technology to enhance customer experiences will be well-positioned for success from the expected home services industry growth.