Australia Home Improvement Market Report Size Share Growth Drivers Trends Opportunities & Forecast 2025–2030

Australia Home Improvement Market Overview

• The Australia Home Improvement Market is valued at AUD 25 billion, based on a five-year historical analysis, in line with recent estimates placing the market at around AUD 25.45 billion in 2024. This growth is primarily driven by increasing consumer spending on home renovations, a surge in DIY projects, and a growing trend towards home personalization, supported by rising property values and increased consumer confidence. The market has seen a significant uptick in demand for home improvement products and services, particularly following the COVID-19 pandemic period, as more homeowners invest in kitchens, bathrooms, living spaces, and outdoor areas to improve comfort and functionality.
• Key players in this market include major cities such as Sydney, Melbourne, and Brisbane, which dominate due to their large populations and high disposable incomes. These urban centers have a vibrant housing market and a strong culture of home improvement, supported by a variety of retail outlets and service providers that cater to the diverse needs of homeowners and renters alike, with New South Wales and Victoria in particular accounting for a major share of renovation spending.
• The Australian Government’s HomeBuilder program, announced in 2020 under the Economic Response to the Coronavirus and administered through the HomeBuilder Grants by the Commonwealth Treasury, provided time?limited grants to eligible owner?occupiers for substantial renovations and new home builds to stimulate residential construction activity and support economic recovery. This initiative, alongside subsequent state-based renovation and energy?efficiency grant schemes, has encouraged more Australians to undertake home improvement projects, particularly larger structural and energy?efficient upgrades.

Australia Home Improvement Market Segmentation

By Project Type:The market is segmented into two primary project types: DIY (Do-It-Yourself) Projects and DIFM (Do-It-For-Me) / Professional Installation. The DIY segment has gained popularity as more homeowners seek to personalize their spaces and take on renovation projects themselves, supported by easy online access to tools, materials, and instructional content, and by retailers running DIY workshop programs. Conversely, the DIFM segment remains strong, as many consumers prefer to hire professionals for complex tasks, ensuring quality, compliance with building codes and electrical/plumbing standards, and timely completion of larger projects.

By Application Area:The application areas in the market include Kitchen Improvements and Additions, Bathroom Improvements and Additions, Living Room and Interior Upgrades, Exterior Replacements (Roofing, Cladding, Windows, Doors), System Upgrades (Electrical, Plumbing, HVAC), Outdoor & Landscaping (Decks, Patios, Gardens, Outdoor Structures), Disaster Repairs and Maintenance, and Others. Kitchen and bathroom renovations are particularly popular, as they significantly enhance property value and appeal and align with the strong demand for interior renovation in Australia. Outdoor improvements, including decks, patios, and gardens, are increasingly sought after for lifestyle enhancement, driven by the growing focus on outdoor living spaces, energy-efficient upgrades such as insulation and solar, and sustainable materials.

Australia Home Improvement Market Competitive Landscape

The Australia Home Improvement Market is characterized by a dynamic mix of regional and international players. Leading participants such as Bunnings Warehouse, Mitre 10, Home Timber & Hardware, Harvey Norman, IKEA Australia, Beaumont Tiles, Reece Group, Stratco, DuluxGroup, CSR Limited, James Hardie Industries, Fletcher Building, Haymes Paint, GWA Group, 3M Australia contribute to innovation, geographic expansion, and service delivery in this space.

Australia Home Improvement Market Industry Analysis

Growth Drivers

• Increasing Home Renovation Trends:The Australian home renovation market has seen a significant uptick, with renovations reaching AUD 38 billion in future. This growth is driven by homeowners investing in property value, with 62% of Australians planning renovations in future. The trend is supported by a robust housing market, where the average home price in major cities like Sydney is AUD 1.3 million, encouraging homeowners to enhance their living spaces.
• Rising Disposable Income:Australia's disposable income per capita is projected to reach AUD 57,000 in future, reflecting a 4% increase from previous periods. This rise in disposable income allows consumers to allocate more funds towards home improvement projects. As financial stability improves, homeowners are more likely to invest in renovations, with 47% indicating they plan to spend more on home upgrades in the coming period, further stimulating market growth.
• Growing Demand for Sustainable Solutions:The demand for eco-friendly home improvement solutions is surging, with the market for sustainable building materials expected to reach AUD 12 billion in future. This shift is driven by increasing consumer awareness of environmental issues, with 72% of Australians prioritizing sustainability in their renovation choices. Government incentives for energy-efficient upgrades, such as rebates for solar installations, further bolster this trend, making sustainable options more attractive.

Market Challenges

• Supply Chain Disruptions:The Australian home improvement sector faces significant supply chain challenges, exacerbated by global disruptions. In future, 42% of businesses reported delays in material availability, leading to project postponements. These disruptions have resulted in increased lead times for essential materials, such as timber and steel, which have seen price hikes of up to 22%, impacting overall project costs and timelines for homeowners and contractors alike.
• High Competition Among Local Players:The home improvement market in Australia is characterized by intense competition, with over 5,500 registered businesses vying for market share. This saturation leads to price wars, reducing profit margins for many companies. In future, the average profit margin in the sector was reported at just 4%, compelling businesses to innovate and differentiate their offerings to maintain profitability amidst fierce competition.

Australia Home Improvement Market Future Outlook

The future of the Australian home improvement market appears promising, driven by ongoing trends in sustainability and technology integration. As consumers increasingly prioritize eco-friendly renovations, the demand for sustainable materials and energy-efficient solutions is expected to rise. Additionally, the integration of smart home technologies will likely reshape consumer preferences, leading to innovative product offerings. With a growing focus on aesthetics and functionality, the market is poised for continued evolution, catering to diverse consumer needs and preferences.

Market Opportunities

• Adoption of Smart Home Technologies:The smart home technology market is projected to grow significantly, with an estimated value of AUD 5 billion in future. This growth presents opportunities for home improvement businesses to offer integrated solutions that enhance convenience and energy efficiency, appealing to tech-savvy consumers looking to modernize their homes.
• Growth in DIY Projects:The DIY home improvement segment is experiencing a resurgence, with an estimated 32% increase in DIY project participation in future. This trend is fueled by online resources and community support, encouraging homeowners to undertake renovations themselves. Businesses can capitalize on this by providing DIY kits and instructional content, catering to the growing number of enthusiastic DIYers.